The average real estate investor in Oklahoma makes over $85,000 a year, with top earners making $110,545 annually.
As a Tulsa, Oklahoma landlord, you could become a top earner. First, you need to ensure your rental property accounting is accurate and organized.
Managing your rental property finances doesn't have to be complicated. With the help of this guide and rental property management, you'll be well on your way to making the big bucks.
Separate Bank Accounts
Rental property accounting turns into a mess if you don't separate your personal banking account from your property finances. Keeping your rental income separate from your personal funds might be required by law.
If you don't already have a business checking account, create one right away at a Tulsa, Oklahoma bank. Deposit all of your rental income into the account and use the funds for operating expenses.
A full-service property management company can handle these accounts for you.
Track Income and Expenses
With a property bookkeeping process in place, you'll be ready for tax season. Staying organized prevents you from having to sort through multiple bank statements and reports.
Some of the best landlord advice is to utilize property accounting software to track income and expenses. The right software program can automate bookkeeping tasks and update new income for each rental property you own.
You can export this information to a spreadsheet to share important financial data with tax professionals.
Understand Tax Forms
It's important to familiarize yourself with rental property tax forms. There is specific information requested by the IRS.
The IRS requires landlords to complete a Schedule E (Form 1040) to report rental income and expenses. Under the 1099 requirement, landlords must report rental income exceeding $600.
W-9 and 1099 forms are required from employees and non-employees who work for your business. Learning about these forms in advance can make your onboarding and bookkeeping processes run more smoothly.
Reconcile Regularly
Reconciling your financial statements involves comparing the numbers on your statements with the ones on your bank statements. At the end of every year, it's important to complete reconciliation.
Doing this exercise monthly can prepare you for the end of the year. With the right strategy, you'll be able to catch and adjust discrepancies to show accurate information on financial documents.
You can choose to use a cash or accrual method to set up rental property expense tracking.
If you prefer to record rental income and expenses as they occur, use the accrual method. You can use a cash method if you prefer logging income and expenses as they hit your account.
Let Us Help With Rental Property Accounting
Proper rental property accounting can help you keep tabs on your investment. When you hire a property management company, you'll benefit from the expertise of specialized property managers and accounting staff.
At PMI Green Country, we can help Tulsa landlords collect rent, handle security deposits, and prepare for tax season. We'll provide you with monthly owner statements so that you can see how much income you're making.
Since 2016, we've been helping property owners like you maximize profits. Contact us today to get started.
