From online rent collection to vacancy advertising, it’s all included in your rental software. As a landlord, you also need to determine whether you are going to use the cash or accrual accounting method. This is important because it ensures that there is consistency in the way your books are rental property bookkeeping maintained. If you would rather record your income and expenses as they take place, not when they are paid, then recording via an accrual basis is ideal for you. This will allow for you to have a more accurate idea of your cash flow and business performance but can be quite time consuming.
However, it has a limited amount of features and is not fit for professional or enterprise-level users. Users can customize the features they use, making it suitable for any experience level. However, enterprise-level landlords and their accountants will benefit more than small and medium-sized landlords due to the robust accounting software. Property Matrix surpasses other software programs due to its advanced features and customization muscle. It’s capable of managing complex accounting processes, minimizing workload, and eliminating the need for third-party accounting software.
How Can an Accountant Help a Landlord with Bookkeeping?
Rental property owners can use bookkeeping to their advantage to track the financial flows for each property so that they can fine-tune their operations. Many different tools and apps exist solely to help improve your accounting systems. Some are designed specifically for real estate investors and property owners, and others are broader, but they can all benefit you greatly. Schedule E is a tax form that rental property owners fill out to report their profit or loss for their rental property.
Once the date-entry has been completed and verified at least weekly, your monthly reconciliation should be an easy task. Most programs will list expenses one side and income on the other with a checkbox next to every transaction. Your task is to click the checkbox next to each item that matches the bank statement.
Track all income and expenses for your rental properties in real time
Once we had several properties under our belts (and multiple other streams of income), we switched over to Quickbooks. It has been great to keep everything in one place and is extremely powerful in allowing me to separate our different income streams, categorize expenses, and run hundreds of different reports. Swap that pile of paperwork for a secure and automated system that organizes your transactions with precision. You can set it, forget it, and still quickly create financial reports when you need them. The information presented is not intended to be used as the sole basis of any investment decisions, nor should it be construed as advice designed to meet the investment needs of any particular investor. Nothing provided shall constitute financial, tax, legal, or accounting advice or individually tailored investment advice.