How do I setup Quickbooks for flipping houses?

12 Replies

I have looked for along time online for good information about how to set up my quickbooks but can not find any good info.This software is not as easy as I thought it would be, thought it would be plug and play.

Anyways the only info I found was to set up classes for my properties. Please let me know if you have any info for me.

Also, is "Charts of Accounts" where I put my tax, mortgage, utilities ect?

I am lost on how this program works please help.

You may have already done this, but maybe try doing a google search for "quickbooks for real estate" there are probably some tutorials out there that will be helpful.

Also, I use quickbooks for a different industry and am super new to using the software, and when I have questions I have found the support center walks me thru the solutions clearly.

Sorry I could not be of more help.

Hire a Virtual Assistant that is specialised in Real estate Bookkeeping and they will be able to help you out. Fees could be as low as $4 per hour and may even set it up for free if you hire them for your monthly bookkeeping needs.

Start your search at Odesk, freelancer or post an Ad at Craigslist in the philippines

Examples: http://manila.en.craigslist.com.ph/acc/

My degree is in Accounting and I rather bang my head agenst concreate than do any bookkeeping

There are quickbooks "experts" who can be great help; however, I'd suggest a qualified tax preparer very knowledgable in real estate.

Researching tax issue of purchasing a defaulted note, discovered a potential 100% tax penalty. That could have been an ugly surprise. Invest tax planning for your investments.

I've been using QB for years, I used Mike Butler's system to set myself up originally but that was mainly for rentals. I have since just added new classes for new ventures such as wholesaling and flipping.

In the initial set up process QB should give you the options to pick a suitable business model similar to yours, don't let that scare you off because they don't have a perfect fit, it will set up your chart of accounts based on that model and then you can tweak it whenever and however you wish.

Do take the advice of @Laurie Souders and find a good CPA who is experienced with real estate investments and have them guide you and probably review your QB files periodically to keep you on track and out of trouble.

Originally posted by @Ryan S. :
I have looked for along time online for good information about how to set up my quickbooks but can not find any good info.This software is not as easy as I thought it would be, thought it would be plug and play.

Anyways the only info I found was to set up classes for my properties. Please let me know if you have any info for me.

Also, is "Charts of Accounts" where I put my tax, mortgage, utilities ect?

I am lost on how this program works please help.

Ryan,

I'd be happy to explain a bit to you. Its not too bad once you have it set up correctly. The Chart of Accounts is where you list the different types of accounts. For Example:

Inventory: Real Estate Tax Expense
Inventory: Acquisition Cost
Inventory: Repairs X category


and so on as detailed as you want.


I'm in the north burbs if you want to do lunch one day. Just let me know.

Do I set the home addresses up as classes? or as a Job?

For flipping, using a job is probably a good idea- it has a clear start & end and it doesn't span more than 2 years. Using a class would clutter your financials rather quickly.

For holding a property for more than 2 fiscal (usually calendar) years, setting up a general class for properties by category (SFH, MFH, etc.) or geography and then having each distinct property as a subclass is a good idea, so you can print out a Profit & Loss as well as a Balance Sheet for each class or geography to make analysis easy.

If you get to the point that you have so many properties that this structure doesn't meet your needs, you might consider moving on from Quickbooks or grouping properties instead of presenting each individually.


I'm an accountant, but I'm not YOUR accountant. This information is provided for general purposes and is no substitute for advice from a competent CPA familiar with the details of your situation. By using this information, you agree to limit my liability to what you paid me for it (that's $0, btw). Have a nice day.

Originally posted by @Dick Rosen:

I've been using QB for years, I used Mike Butler's system to set myself up originally but that was mainly for rentals. I have since just added new classes for new ventures such as wholesaling and flipping.

In the initial set up process QB should give you the options to pick a suitable business model similar to yours, don't let that scare you off because they don't have a perfect fit, it will set up your chart of accounts based on that model and then you can tweak it whenever and however you wish.

Do take the advice of @Laurie Souders and find a good CPA who is experienced with real estate investments and have them guide you and probably review your QB files periodically to keep you on track and out of trouble.

 Hi Dick,

I am just getting started with flipping and setting up QB for the first time, I chose QB Online.  Any recommendation on the "Industry"? Any other pointers you can give to speed up the learning curve to utilize QB for RE flipping?

@Ryan S.  I've used QB Pro for hundreds of flips, using classes is not the way to go. I used a system from a book called "Contractors guide to Quickbooks Pro" by Karen Mitchell (I have no affiliation). There is a lot of great info in the book for QB newbies, but the best chapter is the one on real estate development.  This is the chapter you want, it has step by step instructions on how to do a development deal in QB, and a flip works exactly the same. 

Hopefully I don't eat my words, because my book is for QB 2001 (yes, I've been at this a while) and the current version is for QB 2014.  I don't have the new copy so I don't know if that chapter is still in the book so buy at your own risk.  I can say, however, that aside from the year the cover of the book hasn't changed at all. Hopefully the contents haven't changed much either. Good luck!

I set up classes for each year and then a class for sold and a class for each address. When the flip is complete you simply move it to sold class. P&L's work great for both my CPA & IRS.

But I'm not an accountant !

@Dick Rosen Do you feel like Mike Butler's Investor Books Pro was a good investment?  It's pretty expensive.  Trying to decide whether it's necessary or just start with Quick Books Pro.  

I don't recall what it cost me several years ago but I was happy with what I got. Now I have developed my own class list and account list and I do not use Mike's system anymore but I know that I learned most of what I do by using his system.

I have been through 2 IRS audits and both the IRS and my CPA have commented on how clean and precise my accounting is. I do accredit this to what I learned from Mike's system but again, I don't use it any longer.

That may not have been a clear answer for you but it's the best I can do.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here