When it comes to maintaining your real estate bookkeeping it can be tempting to leave it to the last minute. Nobody likes sitting down and spending hours going through receipts and bank statements. However, leaving it to the end of the year can result in missed deductions and overpaid taxes and can cost you thousands of dollars.
Thankfully, by following accounting best practices when doing your real estate bookkeeping will enable you to maintain accurate books throughout the year so that you stay on top of your finances and maximize the profitability of your portfolio.
In this episode, we continue our conversation from episode 1 and dive even further into real estate mistakes and learning opportunities that can make you a better investor and the numbers that Sharon and Brandon pay attention to when analyzing a new deal or the success of their portfolio.
Real Estate Investor
When it comes to finding a good CPA or accountant, Lechter advises, "Ask them how many real estate clients they have because you want to make sure they’re not learning on your dime."
In this episode we talk about everything from how your upbringing can set your money mindset and the role mistakes play in learning to succeed to the important numbers you need to be paying attention to.
Real Estate Investor
"You have to be aware of what’s going on. What I see a lot of people doing in real estate is they buy it, hiring a management company, and then they forget about it. They take their finger off the pulse. The result is almost always a drop in profits."
A combination of rental property accounting best practices will help you save time, report an accurate tax return, maximize deductions, and increase monthly cash flow.
Digitize receipts - no more lost and faded receipts.
Keep your personal and business accounts separate - for easy reconciliation.
Collect rent online - automate rent collection and income tracking and never experience late rent again.
Use industry-specific software - Property management and accounting software like Landlord Studio will save you hours of admin and hundreds of dollars each year.
Update your books regularly - Get greater financial insights and make tax time easier by regularly updating your accounts.
Keeping detailed and accurate accounts is vital when managing properties. Here are our top rental property bookkeeping tips for landlords.
Positive rental property cash flow is essential if you want to run a profitable, scalable business. But how much cash flow is good?
Whether you use QuickBooks for rental properties or Landlord Studio, the right tool to track your expenses will save you time and money.