Welcome to the Community, @RS241.

I'll help you record the terminated employee loan balance.

You have the option to write off the uncollectible loan made to a terminated employee. Declaring unpaid loans as a bad debt will clear your accounts receivable and reduce your net profit by the amount of the loan.

I recommend creating a Journal entry. It's also best to consult an accountant to avoid messing your books if you're unsure of the accounts to use.

1. Go to + New.
2. Click Journal entry.
3. On the first line, select an account from the Account field. Depending on if you need to debit or credit the account, enter the amount in the correct column.
4. On the next line, select the other account you're moving money to or from. Depending on if you entered a debit or credit on the first line, enter the same amount in the opposite column.
5. Check the amounts - you should have the same amount in the Credit column on one line and the Debit column on the other. It means the accounts are in balance.
6. Enter information in the memo section so you know why you made the journal entry.
7. Select Save and new or Save and close.

For future reference, read this payroll year-end guide: Year-end checklist for QuickBooks Online Payroll.

Don't hesitate to click the reply button below if you have questions about managing employee loan balance in QuickBooks Online. I'm always here to help. Have a great day.