A disbursement check is a payment made to an individual or organization, typically from a business account You might receive a disbursement check for various reasons, including:
- Payroll: Your employer may issue a disbursement check for your salary or wages.
- Reimbursement: You may receive a disbursement check to reimburse you for expenses you incurred on behalf of your employer or another organization.
- Dividend Payment: If you are a shareholder in a company, you may receive a disbursement check for your share of the company’s profits.
- Payment to a Supplier or Vendor: A business may issue a disbursement check to pay a supplier or vendor for goods or services.
- Profit Distribution: If you are a partner in a business, you may receive a disbursement check for your share of the business’s profits.
- Loan Disbursement: If you have been approved for a loan, you may receive a disbursement check for the loan proceeds.
- Student Loan Disbursement: If you are a student, you may receive a disbursement check for your student loan funds.
- Tax Refund: If you have overpaid your taxes, you may receive a disbursement check for the refund.
How to Identify a Disbursement Check:
A disbursement check will typically have the following information printed on it:
- The name of the payer: This is the individual or organization that is making the payment.
- The name of the payee: This is the individual or organization that is receiving the payment.
- The date of the payment: This is the date that the check was issued.
- The amount of the payment: This is the amount of money that is being paid.
- The purpose of the payment: This is a brief description of why the payment is being made.
What to Do with a Disbursement Check:
If you receive a disbursement check, you should:
- Endorse the check: Sign your name on the back of the check.
- Deposit the check: Deposit the check into your bank account or cash it at a financial institution.
- Keep a record of the check: Keep a copy of the check for your records.
Additional Information:
- Disbursement checks are typically processed within a few days.
- Disbursement checks can be used to pay for a variety of expenses.
- It is important to keep track of your disbursement checks to ensure that you are not overspending.
FAQs:
Q: What is the difference between a disbursement check and a regular check?
A regular check can be written from any kind of account, whereas a disbursement check is paid from a business account.
Q: Can I cash a disbursement check at any bank?
A: Yes, you can cash a disbursement check at any bank that is a member of the Federal Reserve System.
Q: What should I do if I lose a disbursement check?
A: If you lose a disbursement check, you should contact the payer immediately to request a replacement check.
Additional Resources:
What Is Disbursement?
Disbursement means paying out money from a fund. Money paid into a business operating budget, the amount of a loan given to a borrower, or the distribution of a dividend to shareholders can all be referred to as disbursements. A disbursement is another term for money given by an intermediary, such as a lawyer paying a third party on behalf of a client.
To a business, disbursement is part of cash flow. It is a record of day-to-day expenses. A negative cash flow, or one in which expenses exceed income, may indicate impending bankruptcy. Learn more about the types of disbursements.
- A disbursement is the delivery of money from a fund.
- A disbursement in business accounting is a cash payment made within a specified time frame that is entered into the company’s general ledger.
- An accounting of disbursements provides insight into the company’s cash flow over time.
- Payments of dividends to shareholders are often termed disbursements.
- A disbursement is the amount of a student loan that is deposited into a school account on their behalf.
What Is a Loan Disbursement?
When the agreed upon sum is deposited into the borrower’s account and made usable, the loan is said to have been disbursed. Cash is credited to the borrower’s account and debited from the lender’s account when the loan is disbursed.