Note: This is assuming the customer deposit was already booked BEFORE the payment was actually applied to the customer’s open invoice.

Note: This is assuming you do not have your preference setting that makes QuickBooks automatically apply customer credits to open invoices.


  1. Be sure that the pre-existing customer deposit is actually booked correctly for this to work.
    1. Go to the customer deposit entry in QuickBooks Desktop and ensure two things here:
      1. The “Received From” field is filled in with the customer’s name.
      2. The “Account” field (next to the customer name) states “Accounts Receivables” and not an income account.
    2. Now go to the customer’s profile and transaction history in QuickBooks Desktop.
      1. You can do this by choosing Customers>Customer Center, then find your customer and click on their name to view the Transaction List.
    3. Find the invoice you want to apply this deposit to and double-click to open it.
    4. Now click on “Receive Payment” towards the top-right side.
    5. Within the Customer Payment screen:
      1. Choose a payment date that is on the same date or after the deposit date.
      2. The payment amount should be the same as that deposit amount you verified earlier.
      3. Be sure you have the correct invoice check marked in the invoice list in the middle of the screen.
      4. Now click on the “Discounts and Credits” button towards the top.
      5. Within the Discounts and Credits screen that pops up, be sure the Credits tab is chosen and then checkmark the credit you want to apply to this invoice then click Done.
      6. You will now notice within the Customer Payment screen the payment amount changed to zero at the top and, more importantly, there is a new column that now shows on that same row where you check marked the invoice earlier. This new column is entitled “Credits” and should state that same amount that you are applying to this open invoice.
      7. Click Save and Close.

You will now notice, within this customer’s invoice, the Payments Applied indicator at the bottom right will have an increased amount listed that should be equal to that deposit credit you just applied.

Share This Post: