Credit cards are commonly used by landlords to operate their rental properties. Most transactions from your credit card are self-evident — expenses incurred and credit card payments made. But what about when you make payments or earn cash back or rewards on that credit card?
Credit Card Payments
Each credit card payment will appear in the import feed for two accounts: the withdrawal from the checking account and the deposit in the credit card account.
When you book the first, a booked transaction will be added to the system based on that payment record. When you click 'book' for the second, it will find the existing booked transaction and recommend a match that ties both imported transactions to opposite sides of the same journal, showing funds moving from your checking to pay down your credit card balance.
Recording these two points of contact in the same journal is one of the ways that a double-entry accounting system (like REI Hub) helps you keep accurate books without creating duplicate entries.
A credit card payment is a transfer between accounts, so it doesn't count as revenue or an expense. This just shows the movement of money from a checking/savings account, which reduces the liability of the credit card balance.
Credit Card Rewards
The IRS says credit card rewards or cash back should be treated as a rebate or refund. In the Import Feed of your REI Hub account, click "Book" and then select the "Refund Received" transaction template:
We generally suggest you book the refund to the same expense account under which the bulk of your credit card purchases fall. For example, if you frequently use an Amazon credit card for supplies expenses, you will select the supplies expense account when booking the transaction.
Still have questions? Reach out to our Support Team via email at [email protected] or call us at (888)939-6865.