Happy 2023 – a new year is here! If one of your resolutions was less stress, how about starting by simplifying your rental property bookkeeping? Read below for RentRedi’s top tips for bookkeeping to learn what you need to know to easily keep accurate financial records as we start the new tax year.
Keep your books property-based
No matter what type of real estate investor or property manager you are, at a minimum you’ll need a set of records for each property in your rental business. You may also need to record general business expenses that can’t be assigned to a single property, group properties together within your portfolio, or track financials down to the unit level for multi-unit buildings.
Using spreadsheets, this often means setting up your books to include a column per property and using others for general business or shared expenses. In Quickbooks, setup is done by creating and configuring nested classes.
RentRedi integrates with REI Hub’s accounting software. REI Hub is purpose built for real estate, so properties, units, and sub-portfolios are supported out of the box without any special setup or accounting knowledge. When you activate accounting through RentRedi, we’ll automatically sync your properties and units to REI Hub for you, so you’ll be up and running with property-based books without delay.
Use separate accounts for your rental business
Keeping your personal finances separate from your business will help you stay organized and save you time. By using a separate bank account or credit card for your rental property, you’ll always know which expenses are business related, and therefore tax deductible. You’ll also have a central source of information, making it easy to find and classify transactions while completing your tax prep or any day of the year.
If you haven’t opened a checking account for your rentals yet, now is a great time to do so. You’ll thank yourself once you do!
Work from your transaction list
Work from the transaction list of your rental bank and credit cards to keep your books. Doing so will help you stay up to date, make it easy to pick up where you last left off, and ensure that you never miss a deduction.
Accounting softwares, like REI Hub or Quickbooks, securely connect to your bank and download recent transactions making it easy to book and track every expense. By activating REI Hub’s accounting through RentRedi, paid RentRedi invoices are also automatically synced and tagged to the appropriate property and unit – a benefit unique and exclusive to our accounting integration.
Automate your financials
Smoothly getting up and running is great, but over time you’ll want your accounting system to begin doing the work for you. Accounting software lets you use transaction matching rules to recognize and book recurring expenses. REI Hub also automatically recreates your loan amortization schedule and records each loan payment split into interest, principal, and escrow components.
RentRedi’s accounting integration ensures that you never have to split deposits or look up which property revenue should be assigned to. What will you do with that time saved from keeping your books?
Conclusion: RentRedi’s Accounting Makes Bookkeeping Easy
RentRedi’s accounting integration with REI Hub is the easy way to keep accurate books for your rental properties in 2023. With custom tools built for real estate and synced information from RentRedi and your financial institution, you can start the new year on the right foot or catch up on last year’s records before tax time. If you want to improve your rental business, consider investing in the right accounting tools that can help you get the job done.