REI Hub allows you to enter and track security deposits from your tenants alongside your revenues, expenses, and other transactions. While security deposits are not a revenue or an expense and are not reported to the IRS annually, they are still a very important part of managing your rental property and its finances.

Security deposits have their own set of transaction templates in REI Hub to ensure accurate entry. You can view security deposit balances by property and unit on the 'Security Deposits Held' report or view the individual transactions via the filter on the Booked Transactions page.

There are three different types of security deposit transaction templates in REI Hub. You will choose the transaction template that matches the action you are taking with the security deposit: receiving, refunding, or retaining it.

Use the Security Deposit Received transaction template when you first accept a security deposit from a tenant. Receiving a security deposit is not revenue; it is your tenant's money that you are keeping in trust. Therefore, received security deposits are held on your balance sheet as liabilities.

If you have received a lump payment that includes rent and security deposit, split the transaction into the rent and security deposit components and book each piece

individually as appropriate.

This will likely be a transaction that populates in your bank's import feed. When you click "Book," you can select "Security Deposit" and then assign it to the property.

Use the Security Deposit Refunded transaction template when you return some or all of a tenant's security deposit to them. Even though this is money moving out of your accounts, it is not considered an expense as you are simply returning the tenant's money to them.

If you refund part of a security deposit and retain the other part of it, you will enter both a Security Deposit Refunded transaction and a Security Deposit Retained transaction.

These transactions will likely populate in your bank's import feed as most landlords return security deposits via a transfer or check. When you click "Book," then select "Security Deposit Refund."

Use the Security Deposit Retained transaction type when you keep all or part of a tenant's security deposit due to damages or past-due rent. The IRS considers this revenue because you are keeping these funds. If you enter Security Deposit Retained transactions, you will see the revenue reflected in your reports.

Therefore, if you are retaining some or all of the deposit due to damage, it is generally a good idea to make sure you have the expense corresponding to the damage entered into the system as well to ensure you are not showing net revenue from retaining the deposit.

Retained security deposits will always be a manual transaction in REI Hub as there is no imported transaction in your bank's import feed. Use the "Add Transaction" button in the top left corner and select "Security Deposit Retained" in the "Other" column.

There are two main ways to view the security deposits you have booked into REI Hub. You can either view the Security Deposits Held report for a summary based on date ranges or view the individual transaction records on the Booked Transactions page using the filters.

The report will provide a breakdown of your security deposit balances per property and unit and how they have changed over the time period.

The Ending Balance column shows the values as of the last day of your date range. If you selected 'Year to Date,' then the Ending Balance column shows your current security deposit balances as of today.

The Starting Balance column shows the values as of the first date of the range. The Additions and Subtraction columns, combined with the Starting Balance, net out to the Ending Balance.

Navigate to the Booked Transactions page under the Transactions header on the left menu. Click the Filter button on the right-hand side of the screen and filter by Account.

Filter by the Security Deposit Held account to see any transaction regarding security deposits, including ones received, refunded, and retained. Filter by the Security Deposit Retained account to see only the security deposits that were kept and not returned to the tenant.

Optionally filter by the "Security Deposit" transaction type to see security deposits received and currently held, and/or update the Property field to see only security deposit transactions for that one property.