QB Issue Resolution:

The bad accounts will be closed in the current year regardless of how you handle it – so last year stays closed.

To close the open invoices you will create a customer Credit Memo – with amount and tax codes equal to the original invoice.  If there have been ‘allowances for doubtful accounts’ already put on the balance sheet, then that is where the credit codes to, if not then it goes to a current Bad Debt expense.  Customer invoices/credits have to created with ‘items’ no accounts – so you may also need to create a BadDebt item that codes to one of the accounts.

One the Credit is created – apply it to the open invoice to close.

Resolution for Issue 'Bad debt from 2017' available: Yes (Solved).
Source: Intuit Community forum.

Bad debt from 2017: this issue or error code is a known issue in Quickbooks Online (QBO) and/or Quickbooks. Support for this issue is available either by self-service or paid support options. Experts are available to resolve your Quickbooks issue to ensure minimal downtime and continue running your business. First try to resolve the issue yourself by looking for a resolution described below. If it is a complex issue or you are unable to solve the issue, you may contact us by clicking here or by using other support options.

Support for Bad Debt
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Error Recovery for Bad Debt [Canada]
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