What is the Best way to know rent is due & receive rent with multiple deductions
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I own rental homes.
I currently have set up memorized invoices so I make sure I know when the monthly rent is due(for my use only) Is this the best way to keep track of rents due? I am running into a problem when I rec. payment that has multiple deducts from the gross rent (mgmt. fees, Repairs. etc) I am not able to use multiple accounts on an invoice?
Helpful Answer
You want to keep Invoices separate from your expenses. If you are billing the tenant for reimbursable expenses (damages they caused and are responsible for) then you would do it through the write a check feature when you go to pay for the repair. You will choose the tenant to be billed as a reimbursable charge in the Tenant Bill Column.
If you aren't billing the tenant but what to keep track of the expense for that property, then you would write the check to the Vendor and choose the class as the property with the Tenant Column blank.
When you run the Profit and Loss by Class Report it will give you a break down of the income for that rental unit, and all the expenses on it.and It will automatically deduct the expenses from the Income giving you your bottom line.
Nancy Neville, Landlord Consultant
Certified QuickBooks Pro Advisor
Landlord Consultant, http://community.intuit.com/wi...
Answer
You want to keep Invoices separate from your expenses. If you are billing the tenant for reimbursable expenses (damages they caused and are responsible for) then you would do it through the write a check feature when you go to pay for the repair. You will choose the tenant to be billed as a reimbursable charge in the Tenant Bill Column.
If you aren't billing the tenant but what to keep track of the expense for that property, then you would write the check to the Vendor and choose the class as the property with the Tenant Column blank.
When you run the Profit and Loss by Class Report it will give you a break down of the income for that rental unit, and all the expenses on it.and It will automatically deduct the expenses from the Income giving you your bottom line.
Nancy Neville, Landlord Consultant
Certified QuickBooks Pro Advisor
Landlord Consultant, http://community.intuit.com/wi...
Answer
When you memorize an Invoice that's not only to help you know when your tenants rent is due, but also QuickBooks automatically enters the charge for their rent and all you have to do is print it out and send them the Invoice billing them for rent that is due.
To see what tenants have not paid, you would run a Open Invoice Report from the Report Section of QuickBooks and it will show you all the tenants who have not yet paid.
Nancy Neville
Landlord Consultant, http://community.intuit.com/wi...
Answer
If you are the owner and you have a property Manager, then that Property Manager should be giving you a Profit and Loss Statement by Class. If they aren't doing that then you will have to setup your company as though you didn't have a Property Manager.
You will setup your company with classes, vendors and Tenants, with your Property Manager being a Vendor who you will pay (their commission).
When you apply the money the Property Manager received from your tenants, you will apply that money to your Memorized Invoices. And you will apply the expenses to the correct rental, etc.
(Your Property Manager should be doing this for you, that's why you pay them the big bucks) :)
If YOU are the Property Manager, then you will set up your Owners in their own individual companies. And you will apply their tenants rents and money received in their own company files. When it comes time to bill your owners your commission, you bill them from YOUR company file.
Keep it simple. Keep it easy. And there are no headaches.
Landlord Consultant, http://community.intuit.com/wi...
Comment
Nancy, thanks for your replies and patience. Some of my properties do have property managers and others I handle myself (depending on location) The property manager does give me a detailed statement for each rental giving me all the information I need. I want to be able to run my own P&L and have the detailed info on MY books for each property (ie.Class) "Property Manager should be giving you a Profit and Loss Statement by Class, that's why you pay them the big bucks".
As an example: A memorized invoice exits for $1000 which is the gross monthly rent. I receive a check from the property manager for $825 and a detailed statement as follows:
1) Gross rent $1000 2)Management Fee $100 3)Repair of faucet $75 4)Water Bill $25
Exactly how would you receive this payment (thereby closing the invoice as paid and posting the 3 expenses to there proper accounts)?
Thanks, Kenny
Answer
KWH...I have this theory that if one gets a headache trying to figure out how to do something, then I either don't want it, or the instructions are wrong. Life should not be so complicated.
I teach my students, which consists of PM's, and Landlords, and Investors, and CPA's, etc. to setup their company and their clients companies in separate files. This illiminates all this confusion and how do I do this type of stuff.
Your Property Manager should have a bank account set up for you in their Software Program. Where they can deposit tenants funds into your bank account for you (a special holding account you gave them permission to use, strictly for them, when you hired them).
Out of this "holding bank account", they would deposit the tenants rents, and pay bills, and at the end of the month send you a Profit and Loss Report in Detail by Class.
You can also setup QuickBooks for you to match your PM's info, by having the PM send you a Portable Copy of QuickBooks from their work to import into your work. Life is so simple when we don't make life complicated.
Many of us on here have various ways of doing things. Nobody can say their way is the right way. It's up to you to choose what way is the best way for you.
So I can't personally help you out here as I would do it as I have described above. But there are lots of great advisors on here that will most likely tell you how to do it their way and perhaps will be your way.
Nancy Neville, Certified QuickBooks Pro Advisor
Landlord Consultant, Owner of the Landlord School (An Academy of Higher Learning)
Landlord Consultant, http://community.intuit.com/wi...
Comment
Hi Nancy: So my property Mgr MUST use QB, have seperate bank account for me, send portable copy to import -sounds complicated. I definetly appreciate your time and consideration with my issue and have picked up on some improvements I can make. I am planning on posting a reworded question to see if there is another solution. Look forward to communicating with you in the furure. Thanks, Kenny
Comment
Kenney, yes it sounds complicated, but it is an easy way of doing what you want to do. It's just not your way and that's okay. What matters the most is how YOU want it done. So maybe someone will come on and help you out. What's great about QuickBooks is that it can be customized to fit your needs and that's a good thing!
Nancy Neville, Certified QuickBooks Pro Advisor
Landlord Consultant, http://community.intuit.com/wi...
Comment
I posted another question search: How can I receive a payment that needs to be posted to several accounts? and received a answer that worked great for me
Comment
Nancy, I do memorize invoices for my use only (they are not sent out to tenants). My problem is when I receive payment from a property manager.
I want to record the GROSS rent and deduct the Property mgmt. fees along with any repairs that were charged (my cost) on a per class basis. This way I can keep track of how much each unit is costing me for repairs and property mgmt fees. The only way I have figured out how to record this is through a general journal entry (and delete the memorized invoice). I would think there should be a better/easier way to record the receipt in QB that would allow me to put the receipt into at least 3 different accounts.