How do you track expenses for a new LLC?

Question

My wife and I recently closed on our second property. We purchased a house in 2017, lived there for a year, then purchased another house that we are owner occupying while house hacking through STR and renting out our other house at the same time. On top of that, we have had several people approach us about managing their STR in the area while they are traveling for the summer. We also started an LLC that all of the income will go through for these properties.

My question is, what would you recommend for expense tracking for our new business? We want to make sure that we are setting ourselves up well come tax time next year. I have heard about Stessa through the BP podcast and am aware of QuickBooks. I am trying to figure out what the best system is for our situation.

Thanks in advance!

Daniel Hyman · Answer

@Ryan Riches

99% of our clients who use accounting software do so via Quickbooks Online. It has tons of great features with the reporting being the crown jewels.

Just keep in mind that each entity will require its own set of books.

Frank Chin · Answer

I use QuickBooks for my rentals. I like the class functions they you could segregate costs by unit, building, and even geographic locations, such as NY vs MA, through the use of classes, subclasses, down 10 levels.

At the same time, I also did accounting on the side for a government funded non profit that that I use classes to segregate funding sources. But the most important thing is that several years ago, I suffered a stroke, was out of commission for a few months, there's plenty of people out there familiar with QuickBooks that they just came right in, and kept things going quickly. I find the popularity of QuickBooks important. If it was Stressa, I doubt I can make some calls, and so easily find people to fill in.