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Rental property and Quickbooks

I purchase Quickbooks to enter my rental property info.  I've read that some user recommend entering: 

Properties as Class

Tenants as Customers: jobs  

Rent as items 

Is this correct? Or should it be entered differently?

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Best answer 12-10-2018

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Pretty much you got it. Class would be the different prop...

Pretty much you got it. Class would be the different properties, Customers would be the actual units, and job is the tenant. Then use items for the non-inventory or services or inventory you have going on, to track everything from repairs and maintenance to rent. Memorize invoices too for monthly rent payments, and use Merchant Account Services to take credit card payments. 

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My bookkeeper placed my properties into the items list....

My bookkeeper placed my properties into the items list.  Do I need to move them to the class
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I would. Items are to track the rental fee or the items u...

I would. Items are to track the rental fee or the items used to work on the property. Like appliances, non-inventory and inventory parts and services provided to the upkeep of the properties. Property could be a class or a customer, depending on your property setup. If you have several properties you manage, and each property has rental units, I would have the properties be a class, the units be a customer and the tenants be a customer job.
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Not applicable

Pretty much you got it. Class would be the different prop...

Pretty much you got it. Class would be the different properties, Customers would be the actual units, and job is the tenant. Then use items for the non-inventory or services or inventory you have going on, to track everything from repairs and maintenance to rent. Memorize invoices too for monthly rent payments, and use Merchant Account Services to take credit card payments. 

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How do you document the "liabilities" such as damage depo...

How do you document the "liabilities" such as damage deposits . Do you just put them in "liabilities".
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For the SFR I entered: property in classes and customer a...

For the SFR I entered: property in classes and customer and then in multi unit I entered property in classes and customer, and sub accounted each unit.  Is that ok?
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either enter them as a liability or create an other charg...

either enter them as a liability or create an other charge item called Damaged Deposit and link this item to the other current liability account. You can enter a sales receipt for this item to receive the deposit and it will credit the liab acct and debit either undeposited funds or checking.
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I would not use a chart of account to track the units. Un...

I would not use a chart of account to track the units. Units would be customers and jobs would be the rentors.
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Re: Pretty much you got it. Class would be the different prop...

How would this differ in QBO? I don't see the option to add Customers and Jobs

QuickBooks Team

Re: Pretty much you got it. Class would be the different prop...

I've got you covered, bareftrz.

 

I can provide some insight on how this would differ in QBO and the options to add customers and jobs.

 

QuickBooks Online has a different feature that works like job costing and we call it Projects. The steps below will guide you on how to turn it on and set it up in QuickBooks:

 

To turn on the Projects feature:

  1. Click the Gear icon, then select Account and Settings.
  2. Go to the Advanced tab.
  3. In the Projects section, click the pencil icon.
  4. Select the Organize all job-related activity in one place option.
    - Once this is activated, the Projects tab will appear on the left navigation menu.
  5. Click Save, then Done.

Turn on Projects.PNG

Turn on Projects 2.PNG

To set up a Project:

  1. From the left navigation menu, select Projects.
  2. Click Add your first project.
  3. In the New project window, enter the Project name.
  4. From the Customer drop-down menu, choose the correct customer.
  5. (Optional) Add any details you need to enter in the Notes field.
  6. Click Save.

Set up Project.PNG

Set up Project 2.PNG

Now that we've taken care of that, let me show you how to add customers in QuickBooks Online:

  1. Click Sales from the left navigation menu.
  2. Go to the Customers tab.
  3. Select New customer.
  4. Enter the appropriate details for this customer.
  5. Click Save.

Add Customer.PNG

Add Customer 2.PNG

All of this information and more is available from our guides on how to use the Projects feature and add customers. I've also attached a few screenshots to help you with each process.

 

That should do it. With these resources, I'm confident you'll be adding customers and jobs like a pro in no time!

 

Keep in touch with me here should you need any additional assistance, I'm always around to lend a hand. Thanks for dropping in, wishing you a very grand and successful New Year ahead.

Senior Explorer ***

Re: I would. Items are to track the rental fee or the items u...

The problem with having the rental set up this way is when a tenant books more than one rental, that tenant now has a "job" under two different units (customers). When the tenant pays with one check for both units (customers), there is no way to record the payment to cover both units since the tenant has jobs under two different units (customers). I say it is better to have the tenants as customers with units beings the jobs under the customer. Use class to track the property's income and expenses.

Senior Explorer ***

Re: Rental property and Quickbooks

Hi @wjacobs63,

In summary, for income and expense tracking: Your rental units are in QuickBooks as Classes. The tenants are your Customers. The commodity for which they are paying (rent, deposit, etc.) are Items. Don't let anyone convince you to enter your properties as customers and the units as jobs. If you have further questions about this, let me know.

@jmwatkins

Senior Explorer ***

Re: How do you document the "liabilities" such as damage depo...

Hi @liz-blazina,

 

Create a liability account called Damage Deposit Liability. Create an item called Damage Deposit and link it to that liability account. When you create an invoice to your tenant, select the Damage Deposit item. It will post directly to the Damage Deposit Liability account.

 

If you need to refund a customer's deposit, create a Credit Memo/Refund for the tenant and select the item Damage Deposit. Once you have issued the Credit Memo, issue a refund from your bank account. The refund amount will be debited from the Damage Deposit Liability account.

 

@jmwatkins

Not applicable

Re: Pretty much you got it. Class would be the different prop...

Hi @AldrinS,

 

That was a great post, but I am using QBSE online, and don't see any of those options under the Gear icon. Any advice on how I can do something similar?

 

Thanks!

Moderator

Re: Pretty much you got it. Class would be the different prop...

Hello Mirrosis,

 

Welcome to the Community. 

 

Tracking projects and jobs is currently available in QuickBooks Online small business. In QuickBooks Self-Employed, there's no specific category for rental properties. I recommend contacting an accountant or a tax professional to check on what's the best category to use. You can also ask for more help from TurboTax support through this link https://ttlc.intuit.com..

 

Let us know if you have any questions. We'll be right here to help. 

Senior Explorer ***

Re: Pretty much you got it. Class would be the different prop...

Hi @Mirrosis,

So what exactly are you trying to do? Your post comes in the middle of someone else's and I just want to be clear on your question.
You mention that you are using QB online for self-employed. This is a very simplified tracking program and does not allow for any sophistication. You can not add to the chart of accounts. Let me know your business type and your bookkeeping question and I will try to help you figure it out.

Julie

Not applicable

Re: Pretty much you got it. Class would be the different prop...

Which version(s) of Quickbooks Online does this solution work for?  I have Simple Start and am not seeing the Projects section described in your solution.

QuickBooks Team

Re: Rental property and Quickbooks

Welcome to the Community, @deltacraig.

 

I’m here to share some information about Projects feature in QuickBooks Online.

 

This is available for clients with QuickBooks Online Plus and Advanced and for accountants with QuickBooks Online Accountant.

 

Since you’re using QBO Simple Start, you can upgrade to use this feature. Here’s how:

  1. Go to the Gear icon and select Account and Settings.
  2. Choose Billing & Subscription from the menu.
  3. From the QuickBooks section, select Upgrade.
  4. You will be presented with options for upgrading, along with features and pricing. Select Upgrade for the product you want.
  5. Enter payment information, then confirm the upgrade.

 

 

 

Here's an article that provides more details and screenshot about the steps: How do I upgrade my QuickBooks Online subscription?

 

Also, I’m leaving some helpful articles about Projects for your reference:

That should do it. Let me know if there’s anything else you need, I want to ensure your success. Thanks for reaching out and have a great day!

Community Explorer **

Re: I would. Items are to track the rental fee or the items u...

Regarding rental units, I have 100 units(campsites), some of which are rented for the season by 1 “tenant”, some of which are rented weekly so they have up to about 12 different “tenants” per year. I don’t see being able to use class for the sites due to the large number (100) and limited class reporting(columns only in p&l format).The income summary and job profitability reports(summary and detail) seem to be most useful for this number of units. The earlier discussion has been very instructive but I am uncertain in this case whether to set up the customer:job structure as unit:tenant or tenant: unit. Any suggestions?

QuickBooks Team

Re: I would. Items are to track the rental fee or the items u...

Thanks for joining the thread, phild1011.

 

I'm here with some insight to provide regarding your setup with the Customer: Job structure.

 

You could go with the Tenant: Unit structure. This way, you'll be able to retain the profile of your tenants as your customers and then the units that they rent weekly or for the season.

 

However, please be sure to reach out to an accounting consultant to ensure this is the best suit for your business. With Intuit's Find-A-ProAdvisor site, you can search for certified professionals in proximity to your ZIP code that can discuss options more personal to your business's needs.

 

That should get you going in the right direction. Keep in touch if there's anything else I can help you with. Wishing you and your business all the best!

Community Explorer **

Re: I would. Items are to track the rental fee or the items u...

I don't see a way to report on total  actual costs and revenue by site if I use a tenant: site structure for customers.

I expect to have about 400 distinct customers using 100 sites this year.

so, for example, If I set up my customer/job structure as tenant/site like this:

 

customer   job       type        description

Tenant A:  site 01  weekly       rent 6/01/19-6/07/19      $200

Tenant B:  site 02  seasonal    rent 6/01/19-9/31/19      $1,000

Tenant C:  site 01  weekly       rent 6/08/19-6/14/19      $300

Tenant D: site 03   weekly       rent 6/01/19-6/07/19

 

I don't see a way to filter/summarize  the job profitability reports so I can see all costs/revenue by site:

for example, I want to be able to see:

site          total actual cost     total revenue

site 01      $xxx                         $500

site 02      $xxx                         $1,000

.......

site 100   $xxx                     $xxxxx

 

 

but I think I will see:

Tenant A:site 01   $xxx            $200

Tenant B site 02:   $xxx            $1,000 

Tenant C: site 01 $xxx               $300

 

I don't see a way to generate a report by site across tenants unless a setup the structure as 

site: tenant

 

I don't see a way to use classes to do this as the only reporting by class I see is the P&L that goes across the page not down the page.

 

 

 

 

  

QuickBooks Team

Re: I would. Items are to track the rental fee or the items u...

Good to hear from you again, phild1011.

 

I'd be delighted to provide additional clarification regarding this matter.

 

After some research, I found out that you can use the Unit: Tenant structure when setting up property management in QuickBooks. For additional insight about this, you can check out this article: Create a property management company

 

With this, you'll be able to see a summary of the cost/revenue by site, instead of having it separated per tenant on the Job Profitability Summary report.

 

Please reach out to me again if you have further questions. I've got your back and am always happy to help.

Established Community Backer ***

Re: I would. Items are to track the rental fee or the items u...

What is important is to evaluate Your Operations.

 

Yes, this is Fine: "Don't let anyone convince you to enter your properties as customers and the units as jobs."

 

If you are managing your own residential rental property, this works Great. If you are managing it for other owners, then you might want Owner first, Property Second, and Tenant third; desktop allows for 5 levels.

 

Examples:

 

I manage Ski Chalet units or Self Storage units or Camping/RV/Tent spaces or an HOA. That is Property as your Known Available Resource, so you set that up as Customer. Then, the Tenant is the Job or Subcustomer. Now you have the ability to track by Current Tenant, Prior Tenant and Upcoming Tenant, managing prior tenant security funds, upcoming tenant move in payment, etc.

 

And Rent can also be Item as By Unit. Or, for instance, Unit Size. Either method works for the Self Storage facility. That way, you can see Sales, which is going to be By Unit, and that reveals when Unit #101 was Empty for three months, for instance.

 

And you can use Customer = Names, and Job or Subcustomer works fine for property, when you take a reservation system and you know the Family might rent more than one Cabin at the same time. Example: One Family has 40 people and wants to rent Three Properties. Or, again, the Service item (your Sales) is also the specific to the property.

 

It helps if you lay it out and look at what you want for Rows and Columns, for the Accounting, etc. Then, set it up however works for your specific needs.

 

And Class is a financial cross-reference aspect. It offers Reporting as Columns, so that means income over Expense. That's why Class is also used for Property. Now you have the ability to track a New Roof on Building 1, new flooring to units, and the Rent to the tenant.

 

You use any and all of the tools that help you manage your data.

Not applicable

Re: Pretty much you got it. Class would be the different prop...

I am in the situation where there is one building 22 apartments so 21 tentants 1 vacancy.  How do I organize that in Quickbooks Online?

 

I already added all the tenants as the customers.  How should I fix this? 

 

Thank you. 

 

Moderator

Re: Pretty much you got it. Class would be the different prop...

Thank you for joining this thread, Dkossar.

Allow me to take over and provide you with some information about organizing your tenants in QuickBooks Online.

 

You can set up the tenants as a customer if you send invoices directly to them. However, you're going to send the invoices to the property's management, then you can consider tenants as a Service Item in the Product and Services. Or, you can set up the tenants as sub-customers.

 

  • Customer = Unit structure
  • Sub customer = Tenants

There are many reasons, you would want to create sub-customers:

 

  • Track a project.
  • For teams/leagues, you can use sub-customers for the members.
  • A workaround in place of job costing.
  • Homeowner Associations and Property Management Co’s sub-customers for individual properties.

To create a sub-customer:

 

  1. From the left menu, go to Sales or Invoicing, then select Customer.
  2. Select New Customer.
  3. Complete the fields in the Customer Information window. Enter additional information on the Notes, Tax info, and Payment and billing tabs, if necessary.
  4. Select the checkbox Is sub customer. The Parent drop-down arrow will appear.
  5. Select the Parent customer and whether you want to have it Bill with parent or Bill this customer.
  6. Select Save.

You may find these articles helpful:

 

Keep in touch with me if you need any additional assistance with organizing your tenants. I'm always around to lend a hand.

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