Separate accounts for each rental

[Lance Neighbors]

Hey guys, I have a question! Should I open a separate bank account for each rental I own?

[Pat L.]

My wife has always maintained separate accounts for each & every property & we have a lot of them. Her C-CORP was audited once & she learned of the unrelenting detail they will go to.

Then when we did have that IRS Audit they wanted to see the flow of money to/from each property to justify expenses, capital improvements, & repair time-lines to further justify the high mileages claimed regardless of mileage logs. I just gave them the respective ledgers of each account by property. Our ledgers document money in, expenses out, complete with matching scans of cancelled checks &/or scans of CC receipts. It probably saved me a week of time sitting with the auditor as she went through two tax years in what seemed to be intricate detail to resolve their questions. After 3 weeks of several meetings we came out unscathed !!!