I have a customer who HAS to be issued a credit memo for an over-payment, because they are a HUGE company they want to be able to track any over payments directly to the particular invoice/sales order that was over paid and that coincides with their purchaser order number.  
 
Has anyone been successful with creating a credit memo from an overypayment or depsoit?  Help, because this customer will NOT ACCEPT a refund.  Any input would be appreciated.

I believe the credit is going to stay on the account to pay a future invoice but they need to send a document to the customer confirming the credit memo.  Only thing I can think of is to enter a credit in AR-B, save and send a copy of the credit memo to the customer, then reverse it.

I'm not sure if it would work in this case but...
 
For when we have to put a deposit on a purchase order, we have a special Item called PREPAYMENT. It gets entered once as a positive amount and once as a negative. That allows us to receive the positive one and enter an "invoice" to pay the deposit. Then when we receive the goods we receive the negative amount along with the actual items on the PO and enter the invoice. If the deposit was payment in full the invoice amount is 0. If it was partial you can then pay the balance.
 
I realize you are talking about the opposite direction but maybe with some creative thinking you could do something similar on the sales side.
 
BTW, we have a similar customer. The only reason they know they overpaid is because we had to tell them. Multiple times. It started as double paying an invoice because they switched accounting systems and one invoice got entered in both. When they saw the credit on their statement they thought they owed us more money and paid the credit amount. We currently have almost $50k on deposit from them. For over a year...