Age alone does not decide collectibility
An invoice can be old because of a valid dispute, long contractual terms, slow customer process, or genuine inability to pay. Before writing it off, review the customer history and collection evidence.
The decision should be approved at an appropriate level for the amount.
Keep the write-off support
Retain the invoice, delivery or service evidence, collection notes, customer correspondence, reason collection is no longer expected, approval, and accounting entry.
A tax deduction can have separate requirements from the book entry, so give the support to the tax preparer.
Remove the receivable without deleting history
The write-off should clear the open customer balance through the company's accounting policy while preserving the original invoice and payment history. Do not delete the invoice simply to make aging look clean.
Customer-level reporting should still show the loss.
Record later recoveries separately
If cash is collected after a write-off, record the recovery with a link to the original customer and invoice. That preserves both the historical loss and the later cash event.
Review recurring bad debts by customer segment or sales channel to improve future credit policy.
Questions buyers usually ask
When should a business write off an unpaid invoice?
When management concludes collection is no longer reasonably expected under the company's accounting policy, supported by the customer history and collection evidence.
Should the original invoice be deleted after a write-off?
No. Preserve the invoice and collection history, and use an accounting write-off entry so the audit trail remains intact.
Check provider facts at the source.
Compare your options with us.
Institution coordinates formation, bookkeeping, tax preparation, compliance, and finance operations. If you are comparing providers or replacing a fragmented setup, bring us the scope you are trying to simplify.
Contact InstitutionSmall-business bookkeeping is the system that turns sales, expenses, payroll, debt, taxes, and owner activity into reliable financial statements. Here is how to build it so the books remain useful all year, not only at tax time.
A month-end close turns a live transaction feed into reviewed financial statements. This 10-step workflow covers transaction cutoff, reconciliations, payroll, receivables, debt, adjustments, analytical review, and a clean final reporting package.
A reliable monthly close is not a pile of categorized transactions. It is a repeatable process that reconciles source accounts, resolves exceptions, reviews the balance sheet, publishes statements, and gives operators a stable version of the month.