I'm curious to know the best way to set up a new company for managing our rental property expenses/income. We currently have 20 properties. We use a property management company that essentially sends a report each month with our rent and expenses (broken out by property). I need to have a cohesive system in which I include payments made directly by us (mortgage, insurance, etc) along with the information provided by our property management company. Since we do not manage the tenants, I'm not interested in tracking specific "customers", rather just having the property be a "customer". I've read that assigning classes is essential when running reports, in order to assign expenses to different classes (or properties). Would it be best to set up each individual property as a class or a customer? Or both? I envision also creating invoices each month for rent (again, not by name of tenant, but just for the property). Is it possible to create invoices for classes or can they only be generated for a customer? Any other suggestions for starting my "new" company would be appreciated! I have been using Quickbooks for 10+ years for our lawn care/landscaping/snow removal business, but have always just stuck with a basic spreadsheet for our rentals. I am using Quickbooks for Mac 2020 (Desktop version).
Welcome and thanks for reaching out to the Community, @jenakason.
You can use the class tracking feature for properties so you can utilize the profit and loss by class report. However, the ability to create an invoice using classes only is unavailable in QuickBooks Desktop (QBDT). You need to choose a specific customer.
That said, you can consider setting up the properties as a customer if you wish to create a monthly invoice. I also suggest consulting an accountant for further guidance. They can provide more expert advice in dealing with this concern.
I am following up on my original question from several months ago. I am currently using QB 2020 Desktop for Mac. Do I essentially need to set up properties for both customer and class? I understand the importance of having classes set up so when I enter expenses I can track what type of expense it is along with what property it is for. I will set up classes for each individual property we own. Since I will also be creating invoices each month for rent collected, would it make sense to also have these properties as a customer (using the same address/name as the class)? Are there potential issues and/or benefits to having customers vs classes?
Thanks for following up with the Community, jenakason.
To confirm if you'll need to set up properties as both customers and classes, I'd recommend working with an accounting professional.
In the event you're in need of one, there's an awesome tool on our website called Find an Accountant. Each ProAdvisor listed there is QuickBooks-certified and able to provide helpful insights to drive your business's success.