Numerous excellent public schools? Check.
Sunny, paradise-like weather? Absolutely.
An abundance of outdoor activities? For sure.
According to the review site Niche, all those positive characteristics make Orlando, Florida, one of the state's best places to live. And with six in ten residents being renters, it's also one of the best places to be a landlord!
So, if you're considering or have already invested in rental property in Orlando, you've made the right choice. However, before you get excited, remember that your potential profits depend on accurate rental property accounting.
The RE/MAX 200 Realty Property Management Division experts have shared landlord accounting and real estate bookkeeping insights, so read on.
Understand Why Rental Property Accounting Matters
Robust rental property financial management and accounting practices can boost your business's financial health by:
- Letting you conduct efficient rental income tracking
- Helping you prepare for tax season with ease
- Allowing you to make more informed financial decisions to optimize profits
In Orlando, where rental properties can appreciate significantly, maintaining accurate accounting records can make or break your profits.
Start With a Solid Rental Property System
Manage accounting records more straightforwardly with comprehensive rental property technology. Look for one with an accounting system offering features such as:
- Automatic rent reminders
- Expense tracking capabilities
- Tax reporting functionalities
- Tenant management systems
Having a dedicated platform to manage these elements simplifies bookkeeping chores. It can also help you systematically organize your financial and tax data. The more organized you are, the less likely you'll face hefty IRS fines and penalties.
Organize Your Financial Documents
Organizing your financial documents involves:
- Sorting through receipts, invoices, and bank statements
- Creating an easy-to-navigate filing system, either physical or digital
- Labeling folders by property or by year
- Scanning and storing documents in the cloud for easy access
- Regularly purging needless documents to save space
When you organize everything, you'll spend less time searching for documents come tax season.
Keep Accurate Records of Rental Income and Expenses
Record every rental payment you receive and every expense incurred related to your Orlando investment properties. It lets you know where your money goes and comes from. You can categorize expenses into:
- Routine maintenance
- Repairs
- Utilities
- Property management fees
Categorization provides clarity, especially when you prepare your budget. It also lets you quickly evaluate your investments' financial performance.
Stay Abreast of Local Laws and Regulations
Knowledge of the local rental laws in Orlando can help you manage your properties responsibly. Compliance can affect your accounting practices, particularly when tracking:
- Security deposits
- Application fees
- Permissible property tax deductions
Your Journey Towards Excellent Property Management
Incorporating sound rental property accounting practices into your management routine is key to avoiding legal consequences and maximizing investment returns.
But what if you don't have time for accounting, much less managing every aspect of your rental business? Don't worry. RE/MAX 200 Realty Property Management Division can happily take over.
Our team members have decades of property management, accounting, bookkeeping, and finance expertise. Our Director of Property Management, Fred Thompson, holds the elite Master Property Manager (MPM) Designation. In 2010, he also served as president of the National Association of Residential Property Managers (NARPM).
Call us today to learn more about how we can maximize your rental income in Orlando, FL, or to request your complimentary property analysis!
