Write-off
In accounting, write-off means removing an uncollectible receivable against the allowance for credit losses — under the allowance method it has no P&L effect; the expense was taken in the provision.
- Layer
- Lexicon
- Defined in
- Lexicon
- Components
- 3
Authority
This definition follows ASC 326.
Every citation in this system, with the text we read and the date we checked it, is in US GAAP and where these rules come from.
Write-off, in use
Quoted from the 4 documents that use the word — what it does to an interface, in the spec's own sentence.
A remaining difference always requires a disposition — write-off (with reason and account), leave unapplied, or dispute.
Write-off and provision are named as distinct actions, because they have different P&L effects.
Distinguished from a refund and a write-off in the UI copy and in the actions offered — they have different GL, tax, and business meanings.
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
- Allowance for credit lossesAn estimate of the receivables you don't expect to collect, booked against receivables before any customer actually defaults. GAAP calls the model CECL: current expected credit losses.
- Bad debt and write-offs: allowance vs direct methodHow to book a customer who won’t pay: the GAAP allowance under ASC 326, the direct write-off the IRS requires, and what to do if the money comes back.
- Card and ACH payments: applying and reconciling themHow customer card and ACH payments land in the bank net of fees, how to apply them to invoices, handle partial payments and reconcile the deposit.
What it is not called
Each of these is a real word for a different thing. Using it here is what makes a product read as though it was built by someone who has not done the work.
- credit note
- bad debt expense
Components that render this
The concept is not documentation-only. These are the components that name it in their specification, grouped and stated exactly as the catalog states them.
Components that render the terms it depends on
Little in the catalog names this concept outright, but its definition is built out of others that are named. These render expense, credit.
5Ledger & tables
Family spec6Statements
Family spec9Accounting core (GL)
Family spec11Payables (AP)
Family spec13Metrics & analysis
Family specTerms this one depends on
- Allowance for credit lossesThe contra-asset holding the expected credit losses on receivables, so AR is presented at the amount expected to be collected
- ExpenseOutflows or using up of assets, or incurrences of liabilities, from delivering goods or services — recognized when incurred, not when paid
- CreditThe right column. It increases liabilities, equity and revenue, and decreases assets and expenses.
Also in Receivables
Work with this concept
The calculators that compute it and the ledger payloads that carry it. A definition is where a reader starts; these are where they go next.
- Credit notes and refundsWhat object reduces an invoice, and what returns the cash?API
- Bad debt expense vs write-offBad debt expense is the cost of expected credit losses booked when the allowance is built; a write-off removes a specific invoice from receivables against that allowance and does not touch the P&L.Compare
- Journal entry for writing off accounts receivableTo write off an uncollectible invoice under the allowance method, debit Allowance for credit losses and credit Accounts receivable. If the customer later pays, reinstate the receivable (debit Accounts receivable, credit Allowance) and record the cash.Entry
Defined in Lexicon. This page is generated from that document, so the two cannot disagree.