Get a shoe box… - Posted by DougO(NM)
Posted by DougO(NM) on February 03, 2002 at 19:17:42:
Funny you should ask, I’ve been working on the same thing. You are right, book keeping for multiple entities can be a nightmare, but is a necessary evil if you want to play the game. I think it comes down to 3 basic solutions, and personally I haven’t decided which is the lesser evil.
- Seperate set of books for each LLC and property.
- Form a “master” LLC that is the member of each LLC and thus each LLC becomes an asset on the balance sheet of the master LLC, you then keep one set of books but seperate them by class (If using QuickBooks)
- Form a seperate LLC, or perhaps Corporation that is the manager for each LLC. It collects the rents and pays out the net to the other entities.It keeps the detailed records, the others keep basically the net numbers.
- Theres another option I forgot, (variations) on the above three options.
I’ve been trying to query my local “professional” help ie Accountant and Attorney on how to proceed, but have suceeded in only getting frustrated.
As for keeping the books. For one or two properties QuickBooks will work fine by itself. Just Set-up classes for each of the properties. Then when you make a deposit or write a check, make sure to assign it to the proper class (property). You can then see the individual performance of each property.
When you start getting more than a few, a property management software package comes in handy, as QuickBooks is very unweildy if you try to follow their set-up for managing property. I’ve been using one called Property Boss for the last year, but they went out of business and just got bought by another company and are now planning on staying in business, last I heard. It does a great job of keeping track of leases and rental payments. It also interfaces with QuickBooks to handle rent collection deposits.
Hope that helps.