QBO help with a bill payment that went to a closed bank account, later refunded by Intuit. How to fix when affects a 1099 vendor

You cannot void a bill pay payment once Intuit processes it. Instead, create a vendor credit and a bank deposit to record the refund. Make sure to use the same expense account and category from the original bill to keep your 1099 reporting accurate. Here’s how:
 

Step 1: Create a vendor credit
 

1. Select + Create.
2. Select Vendor credit.
3. In the Vendor ▼ dropdown, select the vendor.
4. Enter the Category or Item details matching the original bill.
5. Select Save and close.
    

Step 2: Deposit the refund
 

1. Select + Create.
2. Select Bank deposit.
3. In the Add funds to this deposit section, choose the vendor under Received From.
4. Set the Account to Accounts Payable (A/P) and enter the refund amount.
5. Select Save and close.
    

Step 3: Link the deposit to the vendor credit
 

1. Select + Create.
2. Select Pay bills.
3. Select the Bank Deposit you just created.
4. Verify that the Credit Applied matches the deposit amount and the Total payment is US $0.00.
5. Select Save and close.
    

You'll still need to recreate the bill and issue a new payment with the correct bank account so the vendor actually gets paid. Since this all happens in the same month, using the same expense account throughout means the credit and repayment net out correctly on the 1099. 

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