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Track escheated funds in QuickBooks Desktop

Escheat occurs when there are no legal heirs to property. In finances, this occurs most frequently when a law firm fails to cash a refund check within 90 days. When this occurs governmental agencies are required to send the funds to the state. These funds can be collected at a later date by the firm should they choose. Agencies are required to remit the funds to the state once a year along with an itemized report of the attorneys and amounts.

Detailed instructions

To track escheated funds in QuickBooks Desktop.

  1. Create a new Other Current Liability account with a unique name (for example, Escheated funds to be remitted).
  2. Void the original refund check issued.
  3. Move the funds out of Accounts Receivable and into the account created in step 1 using a journal entry.
  4. From the Company menu, select Make General Journal Entries.
  5. Enter a debit to Accounts Receivable and enter the name of the attorney or law firm in the Customer:Job field.
  6. Enter a credit to the account created in step 1.
  7. Click Save & Close.

Link the journal entry to the existing credit created when the refund check was voided

  1. From the Customers menu, select Receive Payments.
  2. Enter the name of the attorney or law firm in the Received From field.
  3. Click the Discounts & Credits button.
  4. Select the credit and then click Done.
  5. Click Save & Close.

At the end of the year issue a check to the state for the total amount in the liability account along with a detailed report

  1. Locate the amount of the account by viewing the Chart of Accounts.
  2. From the Banking menu, select Write Checks and create a check to the state for the amount. Enter a separate line item for each of the law firms involved.
  3. After saving the check, bring the check back onscreen and click the Journal button.
  4. Export the report to Excel and manipulate the data as necessary to produce the report needed for the state.
KB ID# HOW12231
12/6/2016 6:06:41 AM
PPRDQSSWS406 9138 Pro 2017 326be1