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What is Category for Credit Card Rebate?

bluzchaser

Is there a Category, or Tax Line Item, for registering a deposit/Rebate from a Credit Card or bank?
I assume a rebate is a non-tax item. I tried creating a category as Cash Received, and now my Reports show the rebates as Income. I cannot seem to find the correct way to not show this as income on my Reports.

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NotACPA

Use the same category that you used for the original purchase ... thus reducing the amount spent.

bluzchaser

Thanks for the advice. Your suggestion was very helpful, and you helped me by not having to clutter up my register with additional categories.

Chris_QPW

NotACPA said:

Use the same category that you used for the original purchase ... thus reducing the amount spent.

Won't work. If this was a refund, or "cash back" on a given purchase that would be the right answer, but when we are talking about a "Credit Card Rebate" what is going on is that you are getting "points" for your purchases and then you can redeem them for cash. So this cash isn't connected directly to any given purchase, and you certainly aren't going to want to prorate it into all those possible categories from the purchase.

What I do is I have an income category I have created for this purpose, which isn't connected to a tax line, which is what you @bluzchaser look like you are doing.

As for the report, if you don't want to show that income on a given report, just customize it to not include that category.

Roger Miller

I just create a new income category called "Rebate", and be done with it. I then enable that category in my budget, or any income/expense reports, so that the income is accounted for.

bluzchaser

Interesting comments from Roger Miller,Chris_QPW and NotACPA . But for Roger Miller's response, I have a comment. What you suggested is almost what I did. However, one is still faced with the Report/Expense showing that category coming up as Income, when in fact it is not Income. I guess I will try (alternating ) both suggestions from Chris_QPW and NotACPA, and see how it goes. I am thinking I shouldn't have added a Credit Card Account, then I wouldnt have to enter all debit and credit and Credit Card Rebate transactions with that credit card.

Roger Miller

@bluzchaser Yes, I know what you mean. But creating an income category is the only way to get the rebate amounts subtracted from your expenses. Again, I use that category mainly in my budget, since I also track paychecks and other income in my budget, which is handy because it shows my net savings over the year. If you don't want that category being shown in any report, then just deselect it in the report setting.

Chris_QPW

Note @Roger Miller's suggestion an mind are the same. Mine was just the long winded way of saying it. When you create a new category it doesn't have a tax line associated with it, which is what you want in this case. I just wanted to make sure you didn't connect it to a tax line since rebates aren't taxable.

Roger Miller

@Chris_QPW Thanks for pointing that out. I should have mentioned that I do not associate any tax line with the new category.

ati2003

I guess there are two things here. One is tax related, which I'm not concern about, but the other is the expenses. I created an income category and I can see my credit card debt reduced, BUT when I see my expenses, the expenses amount is not reduced, because Quicken take the income as a pay to the credit card. Your owed amount is reduced, but your expenses not. I guess Quicken has no way to manage redeems.

aethryll

@bluzchaser I know I'm late to this (I came looking for suggestions as well.) I currently (and will probably continue to) do the same as @"Roger Miller" and @Chris_QPW, but if you really did not want this to show as income another option would be to create an expense category for cash rebates. This will now show as a negative expense rather than income.

Alternatively, if you wanted to be more granular and do a bit more extra work, you could create a manual account for your rewards points. This would require you to create a manual transaction for every purchase with that card. Using my Amazon Chase card as an example I would have to:
- Create a manual account for "Chase Rewards Points"
- For every transaction on the Amazon Credit Card I would create a transaction on the rewards account with the same categories
*5% for any transactions from Amazon (as a payment instead of charge)
*2% for anything in the "Food & Dining" parent category (as a payment instead of charge)
*2% for anything from a gas station or drug store (as a payment instead of charge)
*1% for all others (as a payment instead of charge)
- When redeeming rewards points as cashback, transfer from the rewards account in transactions to the credit card account/bank account in to which the points were redeemed
- When redeeming for something else (transferring, purchase from Amazon, w/e else) enter the transaction in manually to the register

The Pro's here would be:
- Easy access to rewards balance (visible in quicken)
- Rewards earnings would show as a negative expense to the purchase category
- No extra income shown on reports
- Easy to create detailed reports on rewards points usage/value
- Budget reflects the savings in each individual category in the same month as the purchase

The Con's:
- A lot of extra work depending on how many cards you want to track rewards points for and how often you use them
- Seriously, this could be a ton of extra work
- Value of unclaimed rewards points would factor in to net worth and banking/spending account values
- More difficult to see at a quick glance how much you've redeemed in rewards points (though easier to see how much earned if you, like me, only redeem them a couple times a year)

The pros/cons change a bit if you decide to tag it as a "Separate" account through the settings. It no longer counts towards your net worth or cash available, but it also won't show in any reports by default.

Personally, I'm going to stick with showing it as a separate non-taxed income line because that meets my needs without any extra work. Expense would be just as acceptable for me, but the other way seems way to labor intensive and (for me) unnecessary.

Boatnmaniac

ati2003 said:

I guess there are two things here. One is tax related, which I'm not concern about, but the other is the expenses. I created an income category and I can see my credit card debt reduced, BUT when I see my expenses, the expenses amount is not reduced, because Quicken take the income as a pay to the credit card. Your owed amount is reduced, but your expenses not. I guess Quicken has no way to manage redeems.

It is not so much that Quicken cannot manage CC reward redemptions as it is that Quicken can only process the data that the CC companies actually download into Quicken. The CC companies use the expenses to calculate the amount of the reward but what they download (and what they provide in their paper statements) is just a single cumulative reward credit number that is not directly linked to any specific purchase transactions.

If what you want to do is to decrease the credit card balance and to decrease the expenses for each of the categories (not transactions) that contributed to the reward redemption you could do the following:

Enter the reward redemption credit transaction into the register.
Split the category so that the reward can be broken out as credits for the categories that were originally debited. For example, if you get a $25 reward redemption credit the split could be set to credit the following categories: Dining ($5), Groceries ($10), Clothing ($8), Entertainment ($2).

Where would you get that category breakdown? Perhaps from your monthly statement or from your online account. It probably won't perfectly match and it won't reduce the specific purchase transactions in Quicken but it probably would be somewhat accurate at the category level.

Doing this could result in a lot of work, especially if the categories used by the CC company do not match up with what you are using in Quicken but only you can decide whether putting in that level of effort will be worth it.

BTW, I also use a non-taxable income category (CC Reward Redemptions). For me I would not find much value in splitting up credits totaling <$1000 per year into perhaps 20 different categories...that's less than $50/year (~$4/month) per category on average which for me is just noise.