QuickBooks 2026 Tips: How to Unapply or Reapply a Credit Memo

Managing credits, invoices, and payments in QuickBooks can be smooth—until an entry gets applied incorrectly. Many users face a common challenge: how to unapply a credit memo in QuickBooks when it has been accidentally linked to the wrong invoice or customer balance. Learn how to unapply a credit memo in QuickBooks with simple steps. Fix payment errors fast. For expert assistance, call +1-866-409-5111. The good news? Whether you are using QuickBooks Desktop or QuickBooks Online, the process is simple once you know the right steps. In this guide, we’ll walk you through the process, explain why it happens, and show you how to avoid similar issues in the future. If you need personalized guidance or bookkeeping help, you can reach a trained accounting professional at +1-866-409-5111. <h2>What Is a Credit Memo in QuickBooks?</h2> A credit memo is an accounting tool used to reduce the amount owed by a customer. It is typically issued when: <ul> <li style="font-weight: 400;">A product is returned </li> <li style="font-weight: 400;">An invoice was overcharged </li> <li style="font-weight: 400;">A discount or adjustment is needed </li> <li style="font-weight: 400;">A billing error occurred </li> </ul> However, when a credit memo is applied to the wrong invoice, you must unapply it to fix the customer’s balance. <h2>How to Unapply a Credit Memo in QuickBooks Online</h2> Follow these steps: <h3>Step 1: Open the Customer Profile</h3> <ol> <li style="font-weight: 400;">Go to Sales </li> <li style="font-weight: 400;">Click Customers </li> <li style="font-weight: 400;">Choose the customer whose memo you want to update </li> </ol> <h3>Step 2: Find the Credit Memo</h3> <ul> <li style="font-weight: 400;">Click on the Transactions tab </li> <li style="font-weight: 400;">Locate the Credit Memo that was applied incorrectly </li> </ul> <h3>Step 3: Unlink the Credit from the Invoice</h3> <ol> <li style="font-weight: 400;">Open the Invoice the memo is applied to </li> <li style="font-weight: 400;">At the top, click Payment link / Credits applied </li> <li style="font-weight: 400;">Remove or uncheck the Credit Memo </li> <li style="font-weight: 400;">Save and close </li> </ol> Once you do this, the credit memo is now available to be applied correctly. <h2>How to Unapply a Credit Memo in QuickBooks Desktop</h2> If you’re using QuickBooks Desktop, follow these steps: <h3>Step 1: Access the Payment</h3> <ol> <li style="font-weight: 400;">Go to Customers </li> <li style="font-weight: 400;">Select Receive Payments </li> <li style="font-weight: 400;">Locate the customer and open the payment associated with the credit memo </li> </ol> <h3>Step 2: Remove the Credit Application</h3> <ul> <li style="font-weight: 400;">In the payment window, uncheck the box next to the Credit Memo </li> </ul> <h3>Step 3: Save the Changes</h3> <ul> <li style="font-weight: 400;">Click Save & Close </li> <li style="font-weight: 400;">The credit memo is now unapplied and available to use on the correct invoice </li> </ul> <h3>Why You Might Need to Unapply a Credit Memo</h3> Here are the most common reasons: <ul> <li style="font-weight: 400;">Credit was applied to the wrong invoice </li> <li style="font-weight: 400;">Customer returned only part of an order </li> <li style="font-weight: 400;">You need to reissue the credit </li> <li style="font-weight: 400;">The customer account balance is incorrect </li> <li style="font-weight: 400;">A billing error needs correction </li> </ul> If you need help correcting customer balances or reconciling transactions, experts are available at +1-866-409-5111. <h3>Pro Tips to Avoid Credit Memo Mistakes</h3> To maintain clean financial records, follow these best practices: <h3>✔ Always verify invoice numbers before applying credits</h3> <h3>✔ Send statements to customers regularly</h3> <h3>✔ Use QuickBooks’ audit log to review previous adjustments</h3> <h3>✔ Reconcile customer balances monthly</h3> <h3>✔ Keep credit memos clearly labeled</h3> Doing this not only prevents errors but also keeps your bookkeeping accurate and tax-ready. <h3>Final Thoughts</h3> Being able to unapply a credit memo in QuickBooks is a valuable skill for any business owner or accountant. Whether you're correcting a simple mistake or reorganizing customer balances, the steps are straightforward once you know where to look. If you get stuck or prefer expert help with credits, invoices, or account cleanup, you can speak with a bookkeeping specialist at +1-866-409-5111 for assistance. <h3>FAQs</h3> <h3>1. Can I delete a credit memo instead of unapplying it?</h3> Yes, but only if it’s not needed. If the credit is still valid, unapply it instead of deleting it. <h3>2. Will unapplying a credit memo affect my reports?</h3> Yes. Any change to customer balances may impact AR, sales, or revenue reports. <h3>3. Can I reapply a credit memo after unapplying it?</h3> Absolutely. Once removed, you can apply it to any correct invoice. <h3>4. Why can’t I unapply the memo in QuickBooks Online?</h3> This can happen if the invoice is partially paid or locked by closing date. Remove restrictions first. <h3>5. Do unapplied credits affect customer statements?</h3> Yes, they will appear as a separate credit balance on the customer’s account.