Real Estate Investor · Alhambra CA · Member since 2009 · 24 posts · 5 votes
Hi everyone,
I am wondering how you guys are doing accounting and bookkeeping for your rentals, doing by yourself, hiring bookkeeper or hiring accountant? I am currently managing the bookkeeping and accounting myself but the more I acquire properties, the more my time is sucking into just bookkeeping and accounting.
My question for someone who hiring the accounting or bookkeeping service, which companies would you recommend (Local, or online like Odesk or Elance?)
Suggestion is highly appreciated. Thank you very much!
Mobile Home Investor · Spanaway, WA · Member since 2008 · 1k+ posts · 578 votes
14y
How many units do you have that the book keeping is taking up too much of your time?? We have been able to manage things using Excel for most of the paperwork. Unless you have over a 1000 units, you should be able to keep up.
Rental Property Investor · San Marino, CA · Member since 2011 · 398 posts · 144 votes
14y
I suggest quickbooks. It's a good pure accounting software that you can just handover to your CPA at the year end for taxes. i agree with Steven Hamilton that if you really don't want to do the bookkeping, then to hire a part-timer. We have a part-time bookkeeper who e-mails us the updated quickbook files of each property at the end of the week for us to review and to pull reports. That being said, it's important that you learn how to use quickbooks (or whatever software for that matter) so that you can catch mistakes, verify records, or simply do the work yourself when you bookkeeper goes on vacation.
One more thing, since our properties have onsite management, we use google docs to coordinate rent collection with the bookkeeper. This is nice so we can keep track of our rent collections as we collect them each month.
Residential Real Estate Agent · Mound, MN · Member since 2010 · 87 posts · 32 votes
14y
I use Quicken Property Management and a local accountant (6 rental properties). He is really inexpensive ($175/year for entire tax return including self employed realtor business) and the software is pretty easy to use once you get it set up.
Investor · Statewide, MO · Member since 2011 · 814 posts · 425 votes
14y
I'm shifting to buildium. The potential time savings at tax time is going to be WELL worth the expense. Getting set up is feeling like having teeth pulled, but the reward will be there.
There's a million mistakes you can make when using excel, imo. I'm thinking about my early years and the uneducated, foolish things I did.
Also, it makes sense to learn (& stay on top of) the accounting side of the business. Most accountants put numbers into forms and leave it at that. If you fail to stay on top of how things tie in together, you're gonna pay more in taxes than you need to.
Landlord · Dallas, TX · Member since 2011 · 63 posts · 7 votes
14y
I do all of my own and really enjoy it. I have a bs in accounting and have always been a numbers gal so it's just my cup of tea. I use quickenbooks. I think it's a lot easier than excel. I'm not good at dealing with sob stories from tenants so my hubby handles all of that. He stinks at numbers. Together we are a good team. I think if numbers aren't your thing build a "team" and find someone who is. Good luck!
Involved In Real Estate · Hollywood, CA · Member since 2010 · 25 posts · 9 votes
14y
I use Quickbooks, not just for my rental properties nut for all my business activities. Although Quickbooks is not really customized for rental properties, it is a straightforward accounting program that will allow you to follow any investments or business activities.
Investor · Valparaiso, IN · Member since 2011 · 103 posts · 65 votes
14y
Originally posted by Ed O.:
I'm too young to not know what saas means. Does this mean it's a nightmare to export data?
thanks for the heads up and explanation!
Saas = Software as a service. In other words, it's "in the cloud" instead of on your computer and you pay a subscription fee to use it rather than making a one-time purchase.
Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes
14y
yeah ed, it's in the "cloud", which means you dont have the file that you are working with. so, if you were ever to want to move to another provider, you might not have an actual physical file that you can upload in the new system.
i back up my quicken file every week, but in your case there's no need for that.
Rental Property Investor · Winslow, ME · Member since 2008 · 826 posts · 281 votes
14y
I use quickbooks and would be happy to share my chart of accounts and systems with you. I use "classes" so that each building is a class and can generate a PL based on cash or accrual, with a couple of mouse clicks. There are a few books out there that show you how to "hack" quickbooks for rental properties. But a quick primer: buildings are customers, tenants are jobs.... create a class for each bulding also .... that will get you 85% of the way there! I've used QB for two other businesses for about 12 years now. Not a pro, but a semi geek!!
Lender · Tyngsboro, MA · Member since 2009 · 3k+ posts · 2k+ votes
14y
I use quickbooks. Since all my entities are single member LLC's, I can incorporate my rental property LLC's and my lending LLC into one QB file. I therefore include my personal accounting into it.
When I am involved in an LLC with partners, I set up a new QB file. Since I don't use QB online version, I can't use a remote bookkeeper. so my local assistant does much of the entry. For complex transactions, I enter them myself.
One of the best investments I ever made was John Hyre's QB overlay. It is essentially a real estate investors chart of accounts with instructions for every conceivable transaction including mobile home notes, subject to's, returning security deposits while withholding repairs, etc. Google John Hyre, he is a real estate attorney, real estate investor, and CPA.
Like Kenneth, I use classes for each building, but my tenants are customers and my buildings are classes. I don't use jobs.
Accountant, Enrolled Agent · Grayslake, IL · Member since 2011 · 5k+ posts · 2k+ votes
14y
My clients who use Buildium make my life easier. Than the "Excel keepers" as I can go through their records there and see the receipts and classify depreciable assets as they should be.
Granted, I prefer to do their books myself so I know its right.
San Francisco, CA · Member since 2012 · 20 posts · 7 votes
13y
Despite being a little bit of an old topic, it is tax season and I'm also a big fan of QuickBooks. Many years ago we used to do it by hand, with an accountant's guidance. We got set up and it became very simple to handle just about anything.
Some tips for new people using QuickBooks (echoing some of Kenneth's comments).
* use customer / job for your properties / tenants
* use classes per unit
* have a rental item
* invoice and receive payments
Milton, MA · Member since 2012 · 9 posts · 0 votes
13y
+1 on that Jonathan Wolter, Quickbooks works great for real estate, when set up correctly you can create all kinds of reports to see exactly what is going on with your properties, your accountant can also customize the file for you, so that you can track your mortgages.
There is an article somewhere on the internet on how to set up Quickbooks for real estate, it has been a while so i do not remember where so anyone interested can google it.
Investor · Milford, CT · Member since 2012 · 592 posts · 285 votes
13y
I use Quicken Property Management. Simple enough and my properties are not too complex for Quickbooks. I can still do an extract for the acccountant. I am sure he probably still needs to massage the numbers a bit but better than excel spreadsheets and a box of receipts.
Anyone use scan system like Neat? I have a scanner and scan some of the important receipts but even thats a pain to categorize. Thank god for online banking and credit cards. I just download all the info to Quicken Property Management and ensure it gets documented correctly.
San Antonio, TX · Member since 2013 · 1 post · 0 votes
12y
What is better for 2 rentals (1 is a duplex and 1 is a single family house), GnuCash, Buildum or Wave Accounting? I'm looking for easy to use software to help me stay organized. Thanks for your help!!
Real Estate Agent · Seattle, WA · Member since 2015 · 40 posts · 24 votes
10y
In the long run, you're much better off to outsource bookkeeping to a local bookkeeper in your area.
I previously worked for a CPA firm and we always recommended small businesses try bookkeeping on their own to understand the how the numbers work. QuickBooks is the industry standard (90% market share) so start there and then outsource as soon as you can. At some point, it will not be worth your time to continue to do the bookkeeping on your own. It's tedious work and most bookkeepers charge $30-75 per hour. It's well worth it free up your time to focus on acquiring new houses.