Merging vendors in QuickBooks organizes your records and helps prevent confusion during invoicing, reporting, and tax filing. 

In this article, you’ll learn how to merge vendors in QuickBooks to ensure your vendor list remains clean and up to date. Let’s get started.

What is merging vendors in QuickBooks?

Merging vendors in QuickBooks is the process of combining two or more vendor profiles into a single entry. This is necessary when you have duplicate vendor records, often caused by slight variations in how you enter information (like different spellings of a company name or separate entries for the same business under different contact details). Over time, these duplicates clutter your system, making it harder to track transactions, pay bills, and generate accurate reports. 

Merging vendors consolidates all transactions and payments for a specific vendor into a single profile. This: 

• Helps eliminate confusion.
• Ensures your financial data remains clean and accurate.
• Simplifies your accounts payable management. 

Steps for how to merge vendors in QuickBooks

Now that we understand what merging vendors means, let’s walk through the steps to: 

• Identify duplicate vendor profiles.
• Verify their details.
• Consolidate them into a unified profile.

QuickBooks Online

QuickBooks Online simplifies vendor management by helping you track payments, bills, and purchases. You can easily add, edit, and organize vendor details. 

Identifying duplicate vendors

To search for and identify duplicate vendors in QuickBooks Online:

1. Open your QuickBooks Online account and navigate to the dashboard.
2. From the left-hand menu, click “Expenses” and select “Vendors” to access your vendor list. 
3. Use the search bar at the top of the vendor list to type in the vendor name you suspect may have duplicates.
4. Scan through the list for vendors with similar but not identical names. These may include slight spelling differences, abbreviations, or extra spaces.
5. Click on each vendor’s name to open their profile. Compare contact information, addresses, and transaction history to confirm if they are duplicates.

Image credit: Rex Jacobsen

Merging duplicate vendors

After identifying duplicate vendors, the next step is to merge them. Here’s how to go about that:

1. Decide which vendor profile you want to keep as the main entry.
2. Open the duplicate vendor profile and click on “Edit.”
3. Change the display name of the duplicate vendor to exactly match the name of the primary vendor.

Image credit: Intuit QuickBooks

4. Click “Save” to update the vendor. QuickBooks Online will automatically merge the two vendor profiles, transferring all transactions from the duplicate vendor to the primary vendor.
5. Return to the vendor list to ensure the duplicate entry has been removed and all transactions are correctly consolidated under the primary vendor profile. 

Note: QuickBooks Online only lets you merge up to four vendors at a time.

Updating transactions and information

Although the vendors have been merged, your job isn’t quite done yet. You still need to verify that all transactions and information were merged as well. To do that:

1. Check the transaction history of the primary vendor to ensure that all payments, bills, and credits from the duplicate vendor have been transferred correctly.
2. If the duplicate vendor had any open balances or unpaid bills, ensure they are now reflected under the primary vendor’s account. You may need to adjust any discrepancies manually.
3. If the duplicate vendor had different payment methods or bank account details, update the primary vendor’s profile with this information, if necessary.
4. Ensure that any linked transactions, such as invoices or purchase orders, are now correctly associated with the primary vendor. If any are still linked to the duplicate, update them to reflect the primary vendor.
5. Review your accounts payable and related reports to ensure everything is accurate and balanced. This will help catch any missing or incorrect transactions.
6. Ensure that the primary vendor profile contains all relevant details and combines the data from both vendors, including:
   • Contact information.
   • Tax ID.
   • Payment terms.
7. Finally, run updated reports, such as the Vendor Balance Detail report, to confirm that everything is correctly merged and that all data is accurate.

QuickBooks Desktop

QuickBooks Desktop offers similar vendor management features as QuickBooks Online, letting you create and organize vendor profiles, record bills, make payments, and generate reports. To merge vendors on QuickBooks Desktop:

Open the Vendor Center

1. Launch your QuickBooks Desktop application. 
2. On the top menu bar, click on the “Vendors” tab.
3. From the drop-down menu, select “Vendor Center.”
4. The Vendor Center will open, displaying a list of all your vendors, where you can add, edit, or manage vendor information.

Image credit: PNATC

Identify duplicate vendors

1. In the Vendor Center, use the search bar at the top to search for vendor names you suspect might have duplicates. 
2. Look for vendors with similar names, slight spelling differences, or variations in contact details.
3. Click on each vendor’s name to open their profile and compare details such as addresses, contact information, and transaction history to confirm duplicates. 
4. Check if the vendors have overlapping transactions or bills, which could indicate they are duplicates.
5. Once identified, make a list of the vendors you believe are duplicates.

Note: If you’re using the Accountant or Enterprise version of QuickBooks Desktop, note that there is a specific “Merge Vendors” button once you’ve identified duplicates.

For Accountant:

1. Go to “Accountant.” 
2. Select “Client Data Review.”
3. Click “Merge Vendors.”

 For Enterprise:

1. Go to the “Company” tab. 
2. Select “Accounting Tools.”
3. Click “Merge Vendors.” 

Edit the vendor to be merged

1. Click on the vendor name you want to edit (typically the duplicate vendor that you want to merge into the primary one). 
2. In the vendor’s profile, click the “Edit” button in the bottom right corner. 
3. This will open the edit window where you can see the vendor’s details. 

Image credit: Treasury Software

Modify vendor name

1. In the edit window, go to the “Vendor Name” field and update the name to exactly match the primary vendor’s name. This ensures both profiles align correctly for merging.
2. After updating the name, click “OK” or “Save & Close” to save your changes.
3. Double-check that the vendor name now matches the primary vendor’s name and is ready for merging.

Confirm changes

1. If necessary, make any last-minute changes to the vendor details, ensuring they match the primary vendor’s profile.
2. Once satisfied with the details, click “OK” or “Save & Close” to finalize the edits.
3. Review the updated vendor profile to verify that QuickBooks applied all changes correctly and that the details are consistent with those of the primary vendor account.
4. If there are other duplicate vendors, repeat the steps to edit and confirm their details before merging.

Verify vendor list

Having completed your modifications, it’s time to ensure everything adds up. To verify the updated vendor list:

1. Click on the “Vendors” menu at the top, then select “Vendor Center.”
2. In the Vendor Center, scroll through your list of vendors to check that you’ve correctly updated all details for each vendor.
3. Use the search bar to locate specific vendors you’ve edited or merged. Ensure their names, addresses, and other details are accurate and consistent. 
4. Look for any remaining duplicates or inconsistencies in vendor names or information. If you find any, address them by editing or merging as needed. 
5. Click on individual vendor profiles to confirm that their transaction history (bills, payments, refunds, etc.) properly matches to the primary vendor. 
6. Generate reports such as the “Vendor Contact List” or “Vendor Balance Detail” to ensure that all information is accurate and that no entries are missing or duplicated.
7. Double-check the balances for each vendor to ensure there are no discrepancies after merging.
8. Once everything appears accurate, save any changes and ensure your vendor list is up to date and ready for use.

Essential considerations when merging vendors in QuickBooks

When merging vendors in QuickBooks, you need to pay careful attention to ensure you combine the right profiles and accurately transfer all relevant data. Here are some essential considerations to help you avoid errors and ensure a smooth vendor merge process. 

Back up your data

Always create a backup of your QuickBooks company file before making any changes, including merging vendors. Doing this:

• Protects against mistakes, allowing you to revert to the original data if there are errors during the merging process.
• Preserves data integrity, ensuring all transactions and vendor details remain intact, even if they are unintentionally altered or lost.
• Avoids permanent changes, protecting your financial records from becoming compromised if your team makes any mistake. 

Review transactions

Before you merge vendors in QuickBooks, carefully review all transactions associated with them. This helps ensure that you don’t lose or incorrectly transfer any important financial data. Reviewing transactions helps you: 

• Ensure you’ve correctly transferred all transactions to the primary vendor profile.
• Account for open bills or payments associated with the duplicate vendor.
• Prevent lost or duplicated transactions during the merge process.
• Ensure that you’ve linked all associated transactions, such as purchase orders or credit memos, to the correct vendor profile.
• Confirm that reports like accounts payable or vendor balance details remain accurate post-merge.

Custom fields

When merging vendors in QuickBooks, consider how to handle custom fields. Custom fields are unique data fields that businesses use to track specific vendor information, such as contract numbers or special payment terms. 

Since QuickBooks merges vendor profiles based on the name and primary details, custom fields from the duplicate vendor profile may not automatically transfer to the primary vendor profile. So it’s a good practice to manually transfer any vital information stored in custom fields to the primary vendor’s profile before merging. 

This ensures that you don’t lose any critical details unique to the duplicate vendor. After merging, review the primary vendor profile to verify that QuickBooks has correctly carried over all custom field data.

Why do you need to merge vendors in QuickBooks?

Merging vendors in QuickBooks has a couple key perks. It helps keep your data accurate and makes handling vendors easier. When you combine duplicate vendor profiles, you cut out confusion in your records and ensure that all your transactions and payments connect to one vendor account. 

You’ll notice fewer mistakes, such as missed payments or double bills. This also helps you better see what each vendor is doing. Plus, with less clutter in your vendor list, managing your accounts payable becomes a breeze. You’ll find that creating reports is simpler and more dependable. In the end, this saves time and makes your financial management smoother.

Key takeaways

• Merging vendors consists of combining two or more vendor profiles into a single entry.
• The vendor merging process in QuickBooks Desktop differs slightly from that of QuickBooks Online.
• Always back up your QuickBooks company profile before initiating a merge process.
• Confirm consolidation of transactions and information after merging vendors.

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How to merge vendors in QuickBooks FAQs

Can I undo a vendor merge in QuickBooks?

Unfortunately, once you complete a vendor merge in QuickBooks Online, you cannot undo it. This is why it’s crucial to carefully review all vendor details and transactions before merging. That said, in some versions of QuickBooks Desktop, there is a limited window of time during which you can use the “Undo” feature to reverse a merge.

Can I merge vendors with different currencies?

QuickBooks does not allow you to merge vendors that have different currencies assigned to them. QuickBooks links each vendor to a specific currency, and requires that both vendors involved in the merge share the same currency. If you attempt to merge vendors with different currencies, you’ll receive an error message and won’t be able to complete the process. To resolve this, you would need to manually adjust the currency settings or re-enter vendor information to ensure consistency before merging. 

Can I merge a vendor with a customer in QuickBooks?

No, QuickBooks does not allow you to merge a vendor with a customer. QuickBooks treats vendors and customers as separate entities within the system, each with its own set of features and transactions. Merging them could cause confusion in your records, as vendors typically deal with accounts payable, while customers are linked to accounts receivable. 

The post How to merge vendors in QuickBooks: A step-by-step guide appeared first on Method.

Even in the warmest relationships, refunds happen. Maybe a shipment arrived late, or there were too many pencils and not enough pens—regardless, you get your money back from vendors from time to time. Once that refund arrives in your account, QuickBooks Online will be ready for action.

This guide has all the steps outlining how to record a vendor refund in QuickBooks Online. Let’s get started!

What are vendor refunds in QuickBooks Online?

QuickBooks Online views a vendor refund as any event where a vendor returns money back to your business. 

A refund returned by a vendor may occur due to various reasons. Maybe they charged you excessively, provided reimbursement for an unwanted item, or repaid a credit that remained unused on your end. 

Unlike refunds for customers—where funds flow out from your account—in the case of vendor refunds, the cash flow comes from them and into your account.

Recording these in QuickBooks is key to keeping your bank accounts, vendor balances, and financial statements accurate—otherwise, you can see how things could get messy. 

Steps to record vendor refunds in QuickBooks Online

There are three main steps to recording vendor refunds in QuickBooks Online. Each one makes sure your financial data stays neat and accurate, so managing the cash flow becomes easier, and you avoid having to perform an unreconciliation. 

Step 1: Record the refund as a vendor credit

When a vendor refunds you, the first thing you’ll need to do is record it in QuickBooks as a vendor credit. QuickBooks will use this to track the amount owed to you by the vendor.

It’s especially important if this refund is going to be applied to any bills in the future.

Purpose of recording a vendor credit:

• It ensures the refund is properly tracked, so nothing gets missed.
• It keeps a clear record for reconciling your accounts later on.
• It creates an audit trail just in case you need it come tax time.

Navigate to vendor credit

1. Log in to QuickBooks Online.
2. From the + New button on the left-hand menu, select “Vendor Credit”.

Image credit: LiveFlow

Enter vendor credit details

3. Here, you’ll see fields to enter the vendor credit details. Here’s a breakdown:
   • Vendor name: Pick the vendor that is providing the refund.
   • Date: Enter the date of the refund.
   • Category: Choose the expense account or category related to the refund.
   • Amount: Add the refund amount here.
   • Memo (optional): Write a quick note about why you got the refund as a reminder.

Image credit: 406 Bookkeeping Services

Save the vendor credit

4. Click  “Save and Close” to finish. Or, if you have more vendor credits to log, click “Save and New” to keep going.

Step 2: Record the refund deposit

It doesn’t matter how the money was returned to your business (check, direct deposit, cash, or even a tangible item)—you need to record it strictly as a deposit in your bank account. 

Recording the deposit is important because it:

• Accurately shows the cash flowing into your account.
• Ensures there are no mismatches in your bank reconciliation. 
• Helps QuickBooks recognize the deposit as an incoming transaction.

Navigate to “Bank Deposit”

1. Log in to QuickBooks Online.
2. From the + New button on the left-hand menu, select “Bank Deposit”.

Enter deposit details

3. The Bank Deposit screen will open, where you can enter the following details:
   • Bank account: Pick the account where the refund was deposited.
   • Date: Enter the date the refund was deposited into your bank.
   • Received from: Select the vendor who gave you the refund.
   • Payment method: Choose how the refund was received (check, cash, etc.).
   • Account: Select the right account for the refund, typically the expense account tied to the original purchase.
   • Amount: Add the refund amount.
   • Memo (optional): If you want, include a short description for later reference. 

Image credit: Intuit QuickBooks

Save the deposit

4. Save the deposit by clicking “Save and Close,” or select “Save and New” if you have some more deposits to add.

Step 3: Link the vendor credit to the deposit

Now, you’ll need to link the vendor credit you recorded in Step 1 to the deposit you recorded in Step 2. This lets QuickBooks connect the dots and accurately reflect the refund in both your Accounts Payable and any subsequent financial reporting.

Linking the credit matters because it:

• Prevents any duplicate transactions from showing up in your financial statements.
• Keeps your Accounts Payable and bank balance in sync.
• Makes reconciling accounts and handling audits way less complicated.

Navigate to “Pay Bills”

1. Log in to QuickBooks Online.
2. Select “Expenses” From the left-hand menu and then click “Pay Bills”.

Image credit: QuickBooks

Apply the vendor credit

3. Find the vendor associated with the credit.
4. Check the box next to the matching bill or deposit.
5. Under the “Credit Applied” field, you’ll automatically see that available credit associated with that specific vendor. 
6. Double-check that the credit amount matches the deposit amount.

Image credit: QuickBooks

Save the payment

7. When everything looks right, click “Save and Close” to finalize the payment. If you have more credits to apply, click “Save and New” to keep going.

Can you track vendor refunds separately in QuickBooks Online?

Yes, QuickBooks Online allows you to track vendor refunds completely separately. You can do this by using the Vendor Credit and Bank Deposit features, where you can create two distinct records. These will show up in your vendor reports, transaction logs, and balance sheet. 

Keeping these refunds separate makes reconciliation far easier and provides a clear audit trail for tracking refunds from vendors.

What if I made a mistake while recording a vendor refund?

Everyone makes mistakes, but luckily, fixing them in QuickBooks Online is simple and easy. Here’s what you can do:

1. Open the “Expenses” tab from the left-hand menu.
2. Find the refund entry containing the mistake.
3. Click on the transaction to open it up.
4. Edit the incorrect details, like the vendor name, amount, or category.
5. Click “Save and Close” to update the transaction entry.

If the mistake is big, such as selecting the wrong vendor entirely, it’s usually better to delete the entry and start over from scratch. That way, you avoid any confused looks from your accounting team down the road.

Key takeaways

• Recording vendor refunds properly is important. You need to do this to keep your bank account, accounts payable, and financial reports reliable and accurate.
• Stick to the simple three-step process. Record the vendor credit, log the refund deposit, and link the credit to the deposit for a full reconciliation of your accounts.
• QuickBooks Online makes it quite straightforward to handle your vendor refunds with handy tools like Pay Bills, Bank Deposit, and Vendor Credit.
• Always remember to link vendor credits to deposits to avoid any duplicate entries in your financial reports.
• Make use of the notes and memos features to create meaningful descriptions when recording any refunds. 

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How to record a vendor refund in QuickBooks Online FAQs

Can I record a partial refund from a vendor?

Yes, QuickBooks Online lets you handle partial refunds just as easily as a full one.

Just enter the partial refund amount when creating the Vendor Credit. Later, when you link the credit to a deposit, QuickBooks automatically matches the correct amount for you.

Can I attach documentation to the vendor refund transaction in QuickBooks Online?

Any receipts, invoices, or documents related to the vendor refund can and should be attached to the QuickBooks transaction for reference. You can easily do this while entering the Vendor Credit or Bank Deposit.

Look for the Attachments section and add your files there. This way, there will be plenty of reference material for anyone reviewing the transaction.

Can I record a refund from a vendor that I haven’t paid yet?

Absolutely. If you haven’t paid the bill yet but still received a refund, skip the Vendor Credit step and create a Bank Deposit for the refunded amount. QuickBooks records this as an incoming deposit in your bank account.

Is there a way to make tracking refunds easier?

If tracking refunds feels like a lot to juggle, you might want to try Method CRM. It integrates perfectly with QuickBooks to centralize vendor info and simplify payment tracking, making your accounting workflow a whole lot smoother.

The post How to record refunds from a vendor in QuickBooks Online appeared first on Method.

QuickBooks Online has the very useful ability to manage vendor credits within the system, letting small and medium-sized businesses deal with the entire process in one place. 

Keep reading to learn how to apply vendor credits in QuickBooks Online with ease.

What is a vendor credit in QuickBooks?

Vendor credits represent amounts owed to you by a vendor, like bill credits or refund checks, that can later be applied to future bills or services. Where do they come from? Perhaps you’ve been overcharged or there was a mistake on the vendor’s end—this means they’ll need to refund you in some way.

If you’ve ever been a customer at any store, you’ll know that refunds aren’t always given. Sometimes, you’re offered store credit that you can use on a future purchase. Vendor credits in QuickBooks work the same way, where the amount owed is tracked and applied towards future bills and updated in your records.

Step-by-step guide to apply vendor credits in QuickBooks Online

Need to apply vendor credits in QuickBooks? The platform makes it easy for you to record them and either apply them to a bill now or later on. The process can be done in a few simple steps, which we’ll demonstrate below.

Recording the vendor credit

Vendor credits should always be recorded accurately. So, check, double-check, and triple-check your entry before you move on, as these credits will reduce your accounts payable and keep your financial statements sound. You don’t want to misrecord only to run ro issues when auditing or filing taxes, particularly with large amounts.

1. Navigate to the “+ New” button

Once you’ve logged into your QuickBooks Online account and have navigated to the dashboard, click the “+ New” button in the left-hand sidebar.

Image credit: 406 Bookkeeping Services

2. Select “Vendor Credit”

From the menu, select the “Vendor credit” option. 

3. Enter relevant details

Here is where you’ll enter all the details about the vendor and the vendor credit. This includes:

• The vendor name (drop-down menu).
• The date the credit was issued.
• The exact amount.
• Mailing address if applicable.
• Reference number.
• Tags.
• A description of the purpose for the credit.

Image credit: 406 Bookkeeping Services

4. Save the vendor credit

Once everything is filled in, be sure to click “Save and close” to confirm. You should see a pop-up at the top of your screen confirming your vendor credit saved successfully.

Applying the vendor credit to a bill

While you might not have gotten a refund to your original payment method, vendor credits are made to be used so that you can reduce the amount payable from that vendor. When you use those credits for bills, you match your records to your expenses more accurately. Ready to apply those credits to a bill you just received? Follow these instructions.

1. Click on “Pay Bills”

Your first course of action is to find the bill to which the vendor credit needs to be applied. To do so, click on “+ New” from the dashboard and select “Pay bills.” From there, you’ll find a list of bills that you can choose from.

2. Select the applicable credit in the “Credits” section

Find and choose the correct vendor from the list

Under the “Credit Applied” field, you’ll automatically see that available credit associated with that specific vendor. That makes it much easier to apply these credits towards future bills without the manual effort.

Image credit: QuickBooks

3. Confirm the credit amount and apply it to the bill

After completing the rest of the fields like you would when you pay a regular bill, ensure that the credit is present within that bill before you pay. Then hit “Save and close” to set the credit in place.

Applying the vendor credit to a future bill

If you don’t want to apply your vendor credit to your most recent bill, it’s also possible to wait to apply it to a future bill. Simply unmark the vendor credit on your bill, and it won’t be applied. You might want to do this to avoid using it on partially paid bills or for strategic reasons when you’re expecting a larger bill coming up. It can be smarter to hold off and apply that credit in moments when you’ll need it most.

Tips for efficiently managing vendor credits

The better you manage your vendor credits, the more you can improve your cash flow and financial management. But the reality is that business finances can get tricky, which is why you should take advantage of these tips to ease the burden.

Reconciling vendor statements regularly

Make sure to consistently review your vendor statements to see if they’re accurate and align with your financial records. Reviewing them at regular intervals will ensure you don’t miss anything too far in the future when it’s too late and you have many instances of misreported expenses. With accurate books in the long run, you won’t have to scour through months or even years of statements to find those missing credits.

Setting up reminders

Automated alerts are built into QuickBooks for good reason — to keep you on track and so that you don’t forget about credits that are about to expire. Business owners often have to juggle a variety of tasks, inside and outside of finances, so giving yourself a reminder will help you stay ahead of any upcoming payments.

Utilizing QuickBooks Online reports

As a financial management software, QuickBooks Online presents a variety of useful reporting features. The types of reports included will vary depending on your subscription but work on any operating system, with the highest-tier Plus plan giving you access to all of them.

There are a couple of vendor-related reports, including the:

• Vendor Balance Detail.
• Vendor Balance Summary.
• Expenses by Vendor Summary.
• Purchases by Vendor Detail.
• Transaction List by Vendor.
• Vendor Contact List.

These lists will give you a rundown of outstanding balances, including those vendor credits you have yet to use and what’s been applied. In addition, they won’t just show you those details, but give you insights to understand and manage your overall spending with each vendor.

Creating a standardized process

Since managing your expenses relies on consistency and accuracy, creating a standardized process for handling vendor credits is a must for achieving this. With clear steps that can be repeated every time vendor credits need to be handled, anyone on your team can record and apply credits properly without the risk of costly mistakes.

What happens if I apply too much vendor credit to a bill?

Having a standardized system can’t be emphasized enough, especially when it comes to overapplying vendor credits. While you might forget to apply credits once in a while, overapplying is much more damaging to your bookkeeping. If you happen to forget, you’ll end up with a credit balance on your account, which can cause some confusion later on. The solution is to make sure everyone is on the same page. Contact the vendor to ask if those credits are reflected on their end and ensure they don’t change anything administratively.

Key takeaways

As long as you have a proper system in place that can be easily followed by all relevant parties on your team, handling vendor credits in QuickBooks is easy as pie. From this article, you’ve learned:

• That a vendor credit is a monetary credit that can be used for future bills and purchases.
• How to record and how to apply vendor credits to QuickBooks bills.
• That you should reconcile your vendor statements, use QuickBooks’ online reports, and create a standardized process for vendor credit management.

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• Eliminates the need for double data entry.
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• Reduces human errors through user permissions, making your accountants happier.
• Ensures that your financial information is always automatically up to date.

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How to apply vendor credits in QuickBooks FAQs

Can I apply a vendor credit to multiple bills?

QuickBooks Online lets you apply a single vendor credit to multiple bills, which is particularly helpful if you’ve got more than one outstanding invoice from that vendor. If the credit amount is more than the amount on a single bill, for example, you might want to be able to distribute that credit and use it up entirely.

Can I apply a vendor credit to an invoice?

Vendor credits can’t be applied to invoices. Why? Because of the direction of payment. Invoices are sales documents that you issue to your customers, while bills are charges owed to vendors. Similarly, they cannot be applied to payroll.

Do vendor credits expire?

Vendor credits don’t have expiration dates in QuickBooks Online, but there might be a timeframe set by the vendor. You might have to apply credits onto a bill within 90 days, for example, which means you should stay well on top of those reminders and reviews to avoid losing out.

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