There is not a default account in the system for charitable giving because donations are typically not reported with your rental income and expenses (the IRS Schedule E form has no line for donations or charitable giving), and so for most users, it is outside the scope of what they use REI Hub for. Typically, they are reported on the Schedule A form as part of your itemized deductions.
Therefore, there are a few options for handling donations, depending on how you want them to reflect in your reports.
First, you can book it as an Owner Distribution, similar to how you would handle a personal transaction in a business-focused account. This would look like you took money out of the business without any expense or other transaction that would impact your rental property books.
Second, you can update your chart of accounts to include a specific account for donations. This would allow you to see a donation record, which could help track or as a reminder to enter on your Schedule A. You could create the donation-specific account as an equity or expense account.
An equity account would enable you to still book it as an Owner Distribution as discussed above, but would differentiate your donations from other distributions or contributions, enabling you to see a balance. This would be visible on your Balance Sheet in the equity section.
Creating it as an expense account would allow you to book it using the standard expense transaction type, and you would see it reported on your Net Income reports. However, you need to be careful not to include your donations with your standard rental property expenses at tax time on the Schedule E.
Donations will not be reported with your rental property numbers, but it can still be tracked in REI Hub
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Written by Adam Hamilton
Updated over a week ago