QB Issue Resolution:

When an invoice payment is non-collectible, you can clear the invoice by writing it off as a bad debt. Let me guide you on how.

 

First, you’ll need to create an account for your bad debts. Here’s how:

  1. Click on the Gear icon, choose Chart of Accounts.
  2. Click on New.
  3. Under the Account drop-down, choose Expenses.
  4. Choose Bad Debts under the Detail Type drop-down.
  5. In the Name field, enter Bad Debt.
  6. Click on Save and Close.

 

Next, you need to create a product/service to identify the bad debt. Please follow the steps below.

  1. On the left panel, hover your mouse to Sales, and choose Product and Services.
  2. Click on New.
  3. Choose Non-Inventory.
  4. Enter Bad Debt on the Name field.
  5. Choose Bad Debt under the Income account drop-down.
  6. Clear the Is taxable checkbox.
  7. Click on Save and close.

 

Once done, you can now create a Credit Memo to apply to the invoice you want to write off. Here’s how:

  1. Click on the Plus (+) icon, choose Credit Memo.
  2. Select the customer name.
  3. Choose the Bad Debt item in the Product/Service Column.
  4. Enter the Amount as a positive number.
  5. Click on Save and Close.

 

Lastly, let’s apply the credit memo to the invoice by following the steps below.

  1. Open the invoice.
  2. Click on Receive Payment.
  3. On the Credits section, choose the Credit Memo you created. Note that the Amount Received is 0.00.
  4. Click on Save and Close.

 

Feel free to read this article for more information: How to Write Off Bad Debt?

 

Resolution for Issue 'Just looking for some advice on what to do when a client has been invoiced but a payment will not be received because they have now gone bankrupt, How to I close the invoice and acknowledge that this money will now not be coming in?' available: Yes (Solved).
Source: Intuit Community forum.

Just looking for some advice on what to do when a client has been invoiced but a payment will not be received because they have now gone bankrupt, How to I close the invoice and acknowledge that this money will now not be coming in?: 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 item
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