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Commheat
March 24, 2022
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How do I reimburse someone for damages we caused at their property?

  • March 24, 2022
  • 1 reply
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Hi

We did a job at a customer's location. Unbeknownst to us, there was water leaking through the floor into the company below causing damage. I need to write a reimbursement check to pay for the items that were replaced. They are not a customer of ours but the tenant above is.  

How do I do this? What are the exact steps/accounts do I use? Can I reference my customer so it comes off the profit for that job?  I can "Create a Bill" under my vendor " Misc Vendors" but what expense account do I reference?  "Misc Expenses"? I can tag my customer on it so when it comes time to figure out profit or loss, I can deduct it from my profit. 

 

Best answer by AccountantDave

The account naming is really up to you. You could call it anything appropriate really. If this isn't a typical occurrence, just lump it into a misc account. The choice is also yours on putting to a misc vendor or a creating a unique vendor profile for them. One thing to consider is, don't mix 1099 vendors and non 1099 vendor transactions under the misc vendor profile, it will become a hassle. Also, don't mix 1099 relevant expenses (like contract labor) and non-1099 expenses (like a reimbursement) in the same misc account (accounts cant be both 1099 and non). Cleanest thing to do is likely to create an expense account called repair reimbursements, create a vendor for this incident, and in the create bill window, select the related customer in the Customer:Job column. If you don't see that column, right click and select customize columns. That should make things nice understandable without manual math or categorizing later.

1 reply

A
AccountantDaveAnswer
March 29, 2022

The account naming is really up to you. You could call it anything appropriate really. If this isn't a typical occurrence, just lump it into a misc account. The choice is also yours on putting to a misc vendor or a creating a unique vendor profile for them. One thing to consider is, don't mix 1099 vendors and non 1099 vendor transactions under the misc vendor profile, it will become a hassle. Also, don't mix 1099 relevant expenses (like contract labor) and non-1099 expenses (like a reimbursement) in the same misc account (accounts cant be both 1099 and non). Cleanest thing to do is likely to create an expense account called repair reimbursements, create a vendor for this incident, and in the create bill window, select the related customer in the Customer:Job column. If you don't see that column, right click and select customize columns. That should make things nice understandable without manual math or categorizing later.

C
CommheatAuthor
March 30, 2022

Hi Dave

This is exactly what I did do. I used our Misc Vendors account and applied it towards Misc Expenses. It's a one time deal, Thank God. Anything that is under my Misc Vendors is all one-time random stuff like oddball purchases for the office, lunches, gifts, etc.  I do categorize them properly under the correct expense account though.  

 

Thanks for your help!

 

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