Retainage Payments

If you have posted retainage to AR invoices, you can have the system automatically apply payment to the unpaid portion of the retainage.

If you selected the Include Retainage check box in AR Initialize Receipt, the system automatically applies the payment to both the amount due and unpaid retainage for each item until payment is satisfied. If the amount of the check is not sufficient to cover both the amount due and the unpaid retainage for an item, the payment is applied to the amount due only. You can adjust applied amounts manually for any item.

Note: If you do not select the Include Retainage check box in the Apply Payment window, you can still apply payment to retainage by entering the amount manually.

It is important to note that when you are applying a payment to retainage, the amount displayed in the Amount Due column does not reflect the unpaid retainage amount. Therefore, you must adjust the Applied Amount to include both the Amount Due and the Unpaid Retg. For example, if the Amount Due is $1000 and the unpaid retainage is $100, the Applied Amount must be $1100.

Retainage Tax

If you selected the Distribute Tax to Retainage check box in AR Company Parameters, the system calculates retainage tax separately during invoice entry. It is generally considered payable when retainage is released.

However, you can apply payment to retainage before it is released (typically used if you do not release retainage in AR Release Retainage). When you apply payment to retainage (manually or via initialization), it is automatically applied to the retainage tax as well. If you selected the Include Apply RetgTax in Grid check box (Options menu), the amount applied to retainage tax displays in the Apply RetgTax column. You can override the amount if necessary, as long as the amount does not exceed the amount of retainage tax due.