We have a strip shopping building and we rent units from the building to several retail stores. We have accepted rent reductions for several of our renters. What is the best way to account for these rent reductions?
1) We could reduce the amount of the invoices for the months that rent has been reduced. This would be straight-forward, but doesn't really track the income reduction due to covid-19.
2) We could keep the amount of the invoices the same and give a covid-19 credit for the reduced amount of rental income. We would prefer to do it this way because then we would have a journal account with the amount of income that we lost from the covid-19 situation.
My question: What category would that journal account representing the covid-19 credits be in? It doesn't seem to be an income, expense, asset, liability, or equity type account? How would this be setup in the chart of accounts?