---
title: "Write off bad debt in QuickBooks"
slug: "write-off-bad-debt-in-quickbooks"
updated: 2026-10-15T02:26:12Z
published: 2026-10-15T02:26:12Z
canonical: "help.servicetitan.com/write-off-bad-debt-in-quickbooks"
---

> ## Documentation Index
> Fetch the complete documentation index at: https://help.servicetitan.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Write off bad debt in QuickBooks

## 

## Overview

You may encounter customers that are unable to pay the remaining balance they owe your company. If this occurs, you should write off the outstanding *Accounts Receivable* (A/R) as a bad debt expense. Correctly recording bad debt will decrease your A/R and the income recorded for that transaction.

> [!NOTE]
> **Note:** In ServiceTitan, Non-Sufficient Funds (NSF) follows the same solution as bad debt.

---

### 

#### Who uses this feature

- Administrators, office employees, managers, accountants, and bookkeepers
- Applies to all business types
- Applies to all trades

#### Feature configuration

- Account configuration is required to use this feature. Please contact [Technical Support](http://go.servicetitan.com/ask) for details.

## Things to know

**Follow the criteria for bad debt**

You will first need to ensure this customer’s A/R is deemed bad debt. The criteria for bad debt are the following:

- The A/R balance has been outstanding for the past 90 days.
- The customer has gone into bankruptcy.

## Set up ServiceTitan to record bad debt

Before you start recording bad debt, you will need to complete required setup both in QuickBooks and in ServiceTitan.

## Create a bad debt General Ledger Account

To set up a General Ledger Account to expense bad debt:

1. Go to **Settings ![](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/icon-gnav-settings-inactive.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)**.
2. In the side menu, go to **Accounting > General Ledger Accounts > Add GL Account**.
3. Create an Expense account that matches your QuickBooks account.

> [!NOTE]
> **Note:** We recommend naming this GL account *Write Off - Bad Debt*.
4. Click **Save.**

**![Editing a GL account with fields for number, name, type, and description.](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/write-off-bad-debt-in-quickbooks-image-fu7s71ss.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)**

## Create a bad debt Payment Type

To set up a Payment Type to use for recording bad debt:

1. Go to **Settings ![](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/icon-gnav-settings-inactive.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)**.
2. In the side menu**,** go to **Invoicing > Payment and Invoice Types > Add**.
3. Create a *Payment Type* and select the above General Ledger Account from the **Account** dropdown. **Note**: *We recommend naming this payment type* “Write Off”.
4. Click **Save.**

**![Payment type selection for write-off, including journal entry and account options.](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/write-off-bad-debt-in-quickbooks-image-lnjoxv9p.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)**

## Set up QuickBooks to record bad debt

### Create an expense account for bad debt

To create an expense account to map your QuickBooks bad debt item to:

1. In QuickBooks, go to **Lists** **>** **Chart of Accounts**.
2. In the *Chart of Accounts* window, open **Account** > **New**.

> [!TIP]
> **Tip:** You can also use the short-cut CRTL+N.
3. From the **Account Type** dropdown, select *Expense*.
4. In the *Add New Account* window, fill in the required information.

> [!NOTE]
> **Note:** We recommend naming this account *Write Off - Bad Debt*.
5. Click **Save & Close**. Your bad debt account should now show in your *Chart of Accounts*. ![Editing account details for a write-off bad debt entry in accounting software.](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/write-off-bad-debt-in-quickbooks-image-e2i44iax.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)
6. In ServiceTitan, go to **Settings ![](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/icon-gnav-settings-inactive.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)**.
7. In the side menu, go to **Integrations** **>** **Quickbooks Desktop >** **Company File.**
8. Click **Edit** next to *Chart of Accounts Mapped* and make sure the bad debt GL account in ServiceTitan is mapped to the one in QuickBooks. ![Settings overview showing mapped accounts, assigned units, and inventory export options.](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/write-off-bad-debt-in-quickbooks-image-mng0v3u8.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)

## Record bad debt using an expense payment type

1. Use [search](/v1/docs/use-search-in-servicetitan) to find the invoice.
2. Click into the invoice.
3. On the left menu, click **Collect and Apply Payment**. ![Options for updating payment terms, invoice details, and adding tasks or adjustments.](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/write-off-bad-debt-in-quickbooks-image-50h9b543.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)
4. Select *Writeoff* from the **Payment type** dropdown and enter the remaining balance into the **Amount Applied** column. ![Payment form showing writeoff option, amount, date, and memo fields for entry.](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/write-off-bad-debt-in-quickbooks-image-15hhcel2.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)
5. Confirm the payment is applied to the correct invoice.
6. Click **Save.**

**![Invoice application interface showing selected invoices and total amount allocated.](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/write-off-bad-debt-in-quickbooks-image-jiqhkw39.png?sv=2026-02-06&spr=https&st=2026-10-17T12%3A42%3A34Z&se=2026-10-17T13%3A42%3A34Z&sr=c&sp=r&sig=o6MU8NNIgpOlYVdTGKs%2BrFyYn3WjV6nah1uBWx3uRZ4%3D)**
7. [Batch and export](/v1/docs/batch-post-and-export-transactions) the payment to QuickBooks.

## Want to learn more?

- See [AR Transactions report](/v1/docs/ar-transactions-report)

A batch, or invoice batch, is a set of invoices that have been audited and are ready to post. You will use the Invoice screen in ServiceTitan to create invoice batches. On the Invoice screen, you'll have access to unbatched and batched invoices.

[Learn more →](https://help.servicetitan.com/docs/servicetitan-glossary) · [See the full glossary →](https://help.servicetitan.com/docs/glossary-overview)