A debit memo records an amount that a customer owes outside of the normal invoicing process. Common uses include NSF fees for bounced checks, charges for returned items, and billing corrections that add to a customer's balance. Once created, a debit memo appears on the customer's account as an open balance and can be paid like any other charge.
If you are specifically recording an NSF fee for a bounced check, see How to Record an NSF Fee for a workflow tailored to that situation.
Steps
1. Go to Debit Memos. Click Debit Memos in the left sidebar. You will land on the Open Debit Memos tab.
2. Open the debit memo creation form. Click the New Debit Memo button in the toolbar. The Create Debit Memo modal opens.
3. Fill in the Memo Details. The Memo Details section is expanded by default. Complete the following fields:
DM Type — Select the type of charge. Common types include NSF, Returned Item, Billing Correction, and Service Fee. Choose the type that best describes the reason for the debit.
Issue Date — The date the charge is being recorded. Defaults to today.
Amount — Enter the amount being charged to the customer's account. Unlike credit memos, this field is editable directly and does not depend on line items.
Sales Agent — The sales agent associated with this account, if applicable.
Comments — Internal notes about the debit memo. Not customer-facing.
Message — A message to the customer if you need to communicate the reason for the charge.
📸 Screenshot suggestion: The Create Debit Memo modal showing the Memo Details section with the DM Type dropdown, Amount field, and Issue Date visible.
💡 Note: The Amount field on a debit memo is directly editable. This is different from a credit memo, where the amount is calculated from line items. You can still add line items to a debit memo for documentation purposes, but they do not drive the total.
4. Add line items (optional). Click the Add line item button to document what the charge covers in detail. Use Free-form entry to type a description and amount directly, or From item list to select from existing items in your system.
Adding line items is optional but recommended when the charge has multiple components — for example, an NSF fee plus a handling charge — so the breakdown is clear in the record.
📸 Screenshot suggestion: The debit memo line items table with one row added in free-form edit mode, showing the description and amount fields.
5. Review the Record Details (optional). Click the Record Details section to expand it if you need to review tracking fields such as created date and last updated.
6. Save the debit memo. Click Save. The debit memo is created and appears in the Open Debit Memos list. The charge is now part of the customer's outstanding balance.
After Creating
The debit memo will appear in the Open Debit Memos tab and in the customer's history under Debits by Account. It will remain open until a payment is applied that covers the balance. Debit memos have no separate approval stepfor debit memos —they are active immediately upon saving.