Quicken / Accounting Questions

3 Replies

I purchased a 4-plex last December.  I'm finally to the point of organizing my business finances.  I've purchased Quicken Home Business and Rental Property to do this.  My two goals are to 1) make it easier on my CPA with a simple yearly report to help with my taxes and 2) monitor my profit/loss/etc.  All I have to do is itemize/split the monthly transaction from the property management statement (in addition to expenses I pay myself).

First off, how do I label owner contributions?  I could create my own custom category.  But, I thought Quicken would be refined so I'm wondering if I'm missing something.  What about owner withdrawals?

Secondly, what about security deposits?  I don't see a built-in category for that either.  There is a "Security Deposit Forfeit".  Again, I could create my own custom category but I'm wondering if I'm missing anything. 

Any other guidance would be appreciated from this novice bookkeeper.

@Brandon Heimsoth

Congrats on your 4-plex. I believe you approach organizing your bookkeeping backwards. You plan to organize it first and then present to your CPA. I suggest the opposite: discuss it with your CPA before you start, not after you finish.

No matter what we could suggest to you, your CPA may want it done differently. 

@Brandon Heimsoth

Congrats on the fourflex!

Contributions and distributions are items that affect your basis and normally listed under your equity account

Cash(Debit) - $100,000
     Contribution(Credit) - $100,000
To record $100,000 contribution by Brandon to Rental Business


Distribution(Debit) - $50,000
       Cash(Credit) - $50,000
To record $50,000 distribution from Rental Business to Brandon

Security deposits reflect an amount that your tenant paid you that you must pay back. In essence it is a liability account

Cash(Debit) - $1,000
     Security Deposit(Credit) - $1,000
To record $1,000 security deposit by tenant #1

At the end of all this - your balance sheet should look as follows.

Assets
Cash - $51,000

Liabilities
Security Deposits - $1,000

Equity
Capital Contribution - $50,000

Check
Assets = Liabilities + Equity
51,000 = 1,000 + 50,000

I hope this made sense to you. In the chance that this did not make sense to you; I would look to possibly hiring a bookkeeper to maintain your books and having your focus 100% on managing your rental business.

Basit Siddiqi, CPA
917-280-8544

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