At the end of the term year, you may find some delinquent accounts where you do not expect any payment from them. Whether the student no longer attends your school or any other variety of reasons, you'll need to remove the balance owed on their account. There's a few different methods to do this.
Discounts
One suggestion is to create a discount coupon that only the office can use, with some sort of appropriate name, like “Inactive Write Off” or similar description. From there, you should create it as "Fixed Rate > Dollars off, like $1.00 which you can always write in the desired amount each time, but still use the same single discount.
Then just go to any of these balances, click to apply discount, and use this discount. This is also nice because you can run a discount report later and know that X amount was written off. You can create one per year, or one ongoing discount. If you're unsure on how to configure them, check out this support article for more information: Working with Discounts
Custom Payments
The other suggestion would be to create a custom payment method with a label like “Inactive Write Off”. This will show up on the Transaction Reports and will be very noticeable. If you're unsure on how to set up a custom payment type, here's a support article that explains in detail how this is done: Configure a custom payment type
FAQs
How do I track these write offs?
If you plan to use it as a discount, you should use the Discount report in order to look for this information. If you plan to use this as a payment, the Transaction report would better suit your needs.
What are the differences between the two?
The good thing about a discount is you can assign it to a G/L account while you cannot do that to a payment method. This is dependent on how your accountant would like to see the write off within their own language.
What if they have any account credit?
The best thing to do is to use the credit cash out function. This will remove any remaining credit found in their account so that they won't be able to use it for a future purchase.