How to Do Progress Billing in QuickBooks

To do progress billing in QuickBooks, set up an estimate and enable progress invoicing in your account. Once activated, QuickBooks allows you to bill customers in phases by percentage, line item, or custom amounts as the project moves forward. This is especially useful for contractors, construction companies, and service-based businesses managing large jobs where upfront payment isn’t realistic.

Turn On Progress Invoicing in QuickBooks

Before you can create progress invoices, you need to enable the feature in your QuickBooks settings.

1. Open QuickBooks and click the Gear icon in the top-right corner.
2. Select Account and Settings.
3. Go to the Sales tab.
4. Find the Progress Invoicing section.
5. Check the box that says “Create multiple partial invoices from a single estimate.”
6. Save and close.

This step activates progress billing so you can generate partial invoices against approved estimates.

Create a Detailed Estimate for the Project

Progress billing relies on an accurate estimate because it forms the foundation for every partial invoice.

When creating your estimate in QuickBooks:

• Break down the project into clear phases or line items (e.g., materials, labor, inspections).
• Assign costs to each line item.
• Add quantities where relevant, such as square footage for flooring or hours for electrical work.

Example:

This estimate will serve as the billing basis for each project milestone.

Convert the Estimate into a Progress Invoice

Once your estimate is approved by the customer, you can start billing against it.

1. Go to the Sales menu in QuickBooks.
2. Select Customers and find the customer with the approved estimate.
3. Click Create Invoice next to the estimate.
4. Choose how you want to invoice:
   
   • Percentage of the total project (e.g., 30% upfront, 40% mid-project, 30% final).
   • Specific line items (e.g., invoice only for “Materials” first).
   • Custom amounts for each line item (e.g., partial amounts of labor).

QuickBooks automatically applies the amounts to your progress invoice, ensuring consistency with the original estimate.

Send the Progress Invoice to Your Client

Once your progress invoice is created, review it carefully:

• Make sure the invoice shows how much has already been billed.
• Confirm the remaining balance is accurate.
• Add payment terms, such as “Due on receipt” or “Net 15.”

Click Save and Send to email the invoice directly to the client. QuickBooks tracks payments and updates the balance automatically.

Repeat for Each Project Milestone

As the project moves forward, you can continue generating invoices until the estimate is fully billed. For each new invoice:

• Select the original estimate.
• Choose the percentage or specific line items still unpaid.
• QuickBooks automatically keeps track of what’s been invoiced and what’s left.

This ensures you never double-charge a client and always know the remaining balance.

Bonus Tip: Use DepositFix with QuickBooks for Seamless Payments

While QuickBooks handles progress invoicing, collecting payments efficiently is just as important. With DepositFix and QuickBooks integration, you can:

• Accept payments directly online from your invoices.
• Automate receipts and payment confirmations.
• Keep payment records synced in real time.
• Reduce late payments by making it easy for clients to pay immediately.

This combination ensures not only accurate billing but also smooth and professional payment collection.