refunded prepayment entry

Forum|Forum|3 years ago
March 4, 2023
1 reply
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In 2022 we refunded a substantial prepayment to a client (for a cancelled wedding). That prepayment was reported as income in 2021 (although we probably should have not reported it as income). Where do we enter it as a reduction of income for 2022?

Best answer by MonikaK1

In TurboTax, you can enter the amount of a refund of money previously included as income by going to the Income section of your Schedule C activity, then:

In the Income section, select Add income for this work
From the list that appears, select Rebates and Refunds under Less Common Income
Enter a description and enter the dollar amount as a positive figure.

See also this help article for more information regarding self-employment income and expenses.

MonikaK1Answer

In TurboTax, you can enter the amount of a refund of money previously included as income by going to the Income section of your Schedule C activity, then:

In the Income section, select Add income for this work
From the list that appears, select Rebates and Refunds under Less Common Income
Enter a description and enter the dollar amount as a positive figure.

See also this help article for more information regarding self-employment income and expenses.

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Carl11_2

Employee

Depending on the version of TTX you are using, the section could be called "Rebates and Refunds" or "Returns and Allowances". Both mean the same thing.