Entry of purchase and sale of investment properties

WOW! Almost 2 months and NO replies!! I need to know the exact same thing! Have you found your answer anywhere?? If so could you please forward that info. to me I would greatly appreciate it!
Thanks!

Itis amazing that know one seems to have an answer to this not even my accountant as to how ot properly enter real estate transactions in QB's

Hi Bernard,

There are several techniques my landlords use to handle properties such as these. Yet, for your protection, I encourage you to find a local pro advisor to walk you through this.

At a high level, you can use a journal entry, or actually itemize the closing line items in multiple lines of the Write Check dialog. Just choose the appropriate account and enter the amounts for each. Note: sometimes to make things balance, you need to enter a negative amount in the line items.

What's happened in the two months since this originally was posted?

I'll take a shot at it.

Assumption that the flip was quick, thus I won't bother with componetizing the property or making any depreciation entries...

As you said, the numbers don't add up, but the template should help. Zeroing out the escrow account needs to also happen (probably expensed?)

The account numbers are based on my CoA, I hope it is clear what type they represent.

(Excel attachment for the entries)

I am looking for the same answer...what I did was do journal entries:

Credit Sale of Real Estate for the sales price
Credit asset for cost of asset
Debit Cost of Goods Sold for cost of asset
Debit Cost of Goods Sold for closing costs and can itemize them right from closing statement
Debit Cash for amount of NET SALE PROCEEDS
Debit Loan account

Now there are many reason you purchase the property and how you purchase it. To name a few:

1. Rental Property
2. Flip Property
3. Rehab Property to Flip
4. Rehab Property to Rent

How you purchase:

1. Sale
2. Short Sale
3. Foreclosure
4. List goes on...

How to enter the purchase and sale of an investment property in QuickBooks, I strongly recommend three options:

1. You give the HUD sheets to your tax preparer to file tax returns
OR
2. Ask them for a Entry to enter in QuickBooks.
OR
3. Ask someone experienced in real estate who will ask you the right questions before giving you the journal entry.

Some of my investment clients have tried to enter the HUD sheet by them self: Made distributions to the partner and have forgotten to include a line item, thus could not reconcile the profit/loss and the tax return.

So "Manage Properties with QuickBooks" and get on the right track.

I have exactly the same question as Bernard, and sadly, I feel even more confused by the few answers provided. I bought Quickbooks specifically to track my new real estate investment business. I finally sold a property and am thoroughly confused about how to account for the proceed check I received at closing while zeroing out the property as a fixed asset and the mortgage on the property.

Did anyone with a similar question ever get an answer that really helped? If so, could you please share the answer or provide a link or other direction to get the answer? Basically, I really want to know exactly what did you ended up doing.

Many thanks in advance!!!!!!

SoooooConfused,

Hang in there! Sometimes it helps to get a ProAdvisor to walk you through the specifics.

Also, I'd encourage you to post your question in a new topic, and link back to this thread. That way you'll get more attention to your question. Now, it's a little diluted with all the other posts in this thread.

Jonathan
Author: Landlord Accounting with Quickbooks step by step guide
ProAdvisor