Checking account for Rental property
We're transitioning our primary residence to our first long-term rental. For managing rental income and expenses, we're wondering about the best checking account setup. We currently bank with Capital One. Should we use our existing account and open a separate new account specifically for the rental, or should we open an account at a different bank altogether?
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In addition to what others have already said, what you do on the banking side will also depend on how you hold the rental property(s). For instance, if you're using an LLC to own the rental, say for asset protection purposes, then you should absolutely have a separate bank account in the LLCs name to receive rental income. Otherwise, if you hold the property in an LLC but are receiving rents directly into your own personal account you are likely negating much, if not all, of the LLCs benefits by engaging in what would be considered comingling of the LLCs funds with your personal funds.