It's estimated that the job outlook for accountants is expected to grow by 6% over the next decade. When you consider how essential these professionals are to tracking business income and expenses, this shouldn't come as a surprise.
Good accounting is a vital practice for any business, but it's especially important for landlords. Whether you're doing all your rental property accounting yourself, or handing it off to a professional, there are still things you should do to make sure your rental property is running smoothly.
So what are some things you can do to make sure your Jacksonville, FL rental accounts remain organized? In this rental property tax tips guide, we'll answer this question so you can adjust to changing market conditions.
Carefully Track Both Income and Expenses
This is the basic principle of all good accounting for rentals: keep track of the money you make vs the money you spend. Your income refers to the rent your tenants pay you on a monthly or yearly basis.
Expenses cover things like:
- Utilities
- Repairs
- Marketing
- Maintenance
The good news is that you can deduct a lot of your business expenses from your taxable income. As such, always keep an accurate tally of them. To do this we suggest investing in some property accounting software.
Use Your Records to Create Accurate Budgets
Once you've been tracking your income and expenses for a few months you can begin to make a budget with your real estate bookkeeping. There's a reason why your budget is one of the most important aspects of running a business.
It helps forecast the financial path you're on. If you find yourself in the red every month, something needs to change.
Either you need to charge more rent or consider selling the property because if nothing changes you'll eventually lose the property.
Remain Tax Compliant
When you rent your Jacksonville property you will need to pay rental income tax. And since tax codes can change yearly, you should check frequently to make sure you're remaining compliant.
In addition, make sure you're taking advantage of appropriate deductions. Just don't take it too far and deduct things that don't apply to your property. Otherwise, you could get in trouble with the IRS.
Hire Professional Help
Accurate financial reporting while you're managing a property can often seem like an impossible task. As such, you shouldn't be afraid to reach out to help. One option is to go with a professional business accounting firm.
Or, if you want to make things simpler, hire a property management company to help with financial reporting.
There are pros and cons to this option, but ultimately it streamlines the landlord financial management process and makes your job much easier.
Need Help With Rental Property Accounting? Contact Green River Property Management
We hope this guide helped you learn some tips for proper rental property accounting in Jacksonville, FL. Here at Green River Property Management, we know that the accounting needs of every landlord are different.
Some might just need us to review their expenses. Others require an entire financial reporting reorganization.
Luckily, during our fifteen years of operation, we've seen about it all. So if you're ready for top-quality rental property accounting services, get in touch with us today.
