The problem is Quickbooks is recording all income as cashflow and is not adjusting it out.
I purchased a property.
The seller collected rent. These rents get paid to me on the closing statement but as a reduction in what I pay to the seller.
How do I record these rents in Quickbooks:
1) They need to show up as Rental Income for tax purposes
2) They are a non-cash transaction so do not impact cashflow or the balance in my checking account.
The problem is when I record the rents as Rental Income Quickbooks counts it as cashflow even no cash was exchanged.
I tried setting up a Current Asset as Rents Collected. Then I moved the Rents Collected to Rental Income thinking Quickbooks would do an adjustment in Income comes from a Current Asset but this did not happen.
Now I am stumped how to do this. Any ideas or suggestions would be appreciated.
Thanks!
