All Forum Posts by: Soh Tanaka

I'm not an accountant, but here's some suggestions.

If the frequency you are doing the bookkeeping is overwhelming, do it more often or hire someone else to do it. 

I know sometimes you can't just get everything at Home Depot, but it has a rebate program, plus it emails you receipts, so you don't have to carry receipts and scan later, so try to use Home Depot as much as possible (it looks like you are already doing this.)

If you buy a paint for House A, and light bulbs for House B, buy the paint and check out (get a receipt,) and then buy the light bulbs (get another receipt.) Home Depot allows you to enter PO number. Maybe you can put your property address in there (just some thought.)

I don't know anything about Wave, but QuickBooks is great. Initially, there will be some learning curve (I've been using it for years, and I still learn new things,) but once you get it going, it'll give you pretty much everything you need.  

Separating capital improvements and expenses should not be too hard, at least for rentals, as everything prior to property ready to be in service will be "capital improvements" and after that, there should not be that many capital improvements. (This is just how I understand things.)

This is just a general comment about the town, as I don't know the specific of your property and location, but just in general, I would say it's a good place to rent.

For some reason this tenant decided to pay the Jan 2020 rent at the end of Dec 2019 to the property management company. The owner received the rent (minus the fees) from the property management company in Jan 2020. Should the owner report the income in 2019 tax return or to the 2020 tax return?

Thanks,

Soh

I've been using Cozy for receiving rent only. Other features may be OK, but as a proper property management platform, such as accounting, it's way too basic, IMO. I've never used it, but Stessa.com looks nice.

It looks like your life would be much better once you have a better tenant(s) and have a better property manager or manage yourself. I don't see a reason to keep your current PM.

Soh

@Andy Prince - I think it'll be a good idea to have two accounts. One for the security deposits and another one for operation. Make sure you understand the law of your state regarding handling of the security deposit. In terms of the bank, I tried to like local bank/credit union/ but I like big banks better, but that's just me. 

It would definitely be a good idea to have a separate bank account for your fourplex operation, regardless of who owns the property.

Soh

I don't know the area, but paying $200k+ per unit when the rent is $1,500+ on average sounds a bit expensive to me. Just my thought. 

Soh

What is your numbers? Purchase price, rent, repair, property tax, etc.

Soh

One thing people often forget about the crash of 2008/9 is the fact that it took years to bottom out.This is just my view, but losing 24% (or whatever the tax rate is) guaranteed and waiting for years don't seem like a good plan. And this assumes that a very bad crash comes soon, AND you will be predict pretty accurately when to get back in the market.   

Soh