What is the correct way to account for refunds you have received from vendors on a 1065?

[danielle-51]

We have received less than $500.00 in refunds last year from vendors and I just wanted to make sure I knew what to do when we fill out our 1065. We are a multi-member LLC, taxed as a partnership.

[AliciaP1 · Accepted solution]

Refunds from vendors should be credited back to the expense category that applied to the purchase.  For example, if you purchased office supplies for $500 and then returned $100 worth of the supplies, you just need to credit the Office Supplies expense account so the net of the purchase totals $400.  If that was the only Office Supplies expense you had for the year, you would enter $400 for the office supplies expense category on your Form 1065 return.

[danielle-51]

Thank you, Alicia. You have helped me two days in a row with your answers to my questions. I appreciate it!