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Landlord Tips

Move in Checklist for Landlords and Tenants

Move in Checklist
The move in checklist is a valuable guide for landlords and tenants.

Lists are helpful tools as they serve as reminders. Grocery, cleaning, and “honey do” lists are just a few of the many popular ones to mention. The move in check list for landlords and tenants is a valuable guide for both parties. They can complete the checklist together during the walk through of the rental property so all parties are on the same page.

Checklist Benefits

For landlords, the move in checklist for landlords and tenants keeps track of the condition of the rental property. It also serves as a reference to identify any damage that may have occurred during occupancy beyond normal wear and tear. For tenants, the checklist serves as guidance for what repairs or improvements should be made prior to or during the tenancy. It also gives tenants an understanding of the condition of the rental before move in.

Checklist Contents

The move in checklist for landlords and tenants should include the main components of each room in the rental property. For example, items to check for in the kitchen would be a working refrigerator and clean and empty cabinets. For each room reviewed, there should be an area to identify any needed repairs or improvements. The move in checklist can also inform tenants on items such as setting up utilities, managing pets, and throwing away trash.

There are checklist-related tools available for landlords and tenants. For example, Zillow offers a downloadable check list. And landlords can use RentalIncomeExpense.com to track expenses related to agreed upon repairs and improvements.

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Landlord Tips

Rental Property Maintenance Expenses

Rental Property Maintenance Expenses
Landlords face a variety of expenses when managing rental property.

Landlords like to collect rent on time and in full. That’s the revenue side of the landlording business. The expense side can vary widely because of unforseeable surprises. Landlords can organize rental property maintenance expenses into two buckets – known and unknown. Understanding these expenses and preparing for them as best as possible are beneficial for landlording success.

Known Expenses

Known rental property maintenance expenses as those that landlords expect every year. Examples of these types of expenses include mortgage payments, insurance premiums, and property taxes. For the most part, these types of expenses remain the same year over year, and they are rarely a surprise to pay when due. Known expenses are the easier to budget.

Unknown Expenses

Unknown rental property maintenance expenses are more difficult to budget because they are . . . well . . . unknown. Many of these expenses are related to some form of repair. For example, the air conditioning unit could suddenly stop working in the middle of a heat wave, and you need to figure out how to remedy the situation as quickly as possible. Or, a pipe bursts and you need to quickly repair it to prevent damage to the tenant’s property or the rental property. To make life easier, it is wise to do your best to plan for the unexpected. Planning can include setting aside a budget for emergencies or a short list of professionals to help in a time of need.

As landlords incur rental property maintenance expenses, they can track them in landlord software. By tracking expenses, landlords can run reports that may help make budgeting easier for future years. RentalIncomeExpense.com follows the Form 1040 Schedule E expense categories.

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Landlord Taxes

Schedule E for Rental Property

Schedule E
Landlords need to file a schedule E with their form 1040 every tax year to report income (or loss) from rental property.

Schedule E is one of the many schedules that are part of the IRS form 1040. Taxpayers use Schedule E to report income and expenses from supplemental income. In contrast to earned income, supplemental income is not received through employment. Examples of supplemental income include rentals, royalties, and income from S corporations and partnerships. Landlords need to file a schedule E with their form 1040 every tax year to report income (or loss) from rental property.

Income on Schedule E

Schedule E is organized into five parts. Part I is the section focusing on income or loss from rental income. In this section, the primary income to complete falls on line 3: “Rents Received”. On this line, landlords report the rental income received from tenants for each identified property.

Expenses on Schedule E

To complete schedule E, landlords need to classify expenses based on 15 categories provided by the IRS. These expense categories include advertising, cleaning and maintenance, and insurance, just to name a few. In contrast to the simplicity of the rent reporting line, for expenses, landlords need to select a category for each expense for each property.

Completing schedule E is reasonably straightforward. In fact, it becomes very easy to complete if landlords use accounting software to track rental income and expenses. One in particular, RentalIncomeExpense.com, provides a schedule E helper report that mimics the schedule E. At tax time, landlords can provide this report to accountants for easy tax preparation. Best of all, RentalIncomeExpense.com is free!

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Landlord Tips

Landlord Income Expense Tracking Reports

Income Expense Tracking Reports
Landlord income expense tracking reports are necessary to gauge the health of the rental property business.

Landlord income expense tracking is an important task. One benefit of tracking such information is that the data can be used to create helpful reports. When used correctly, reports gauge the health of the rental property business and to assist accountants at tax time.

Landlord Income Expense Tracking Report #1: P&L

The profit and loss statement is a report that summarizes revenues received and expenses incurred with managing rental property. It shows how well or poorly the business is doing by its net income or loss. As a result of using this report, landlords can identify areas to reduce expenses or make improvements to strengthen the business.

Report #2: Schedule E Helper

The schedule E helper report is useful at tax time. This report is unique to RentalIncomeExpense.com. RentalIncomeExpense.com is free landlord accounting software. Landlords file schedule E with form 1040 at tax time. The schedule E helper report follows the same income and expense categories as those on schedule E, and it generates a report to help accountants at tax time.

Landlord accounting software makes it a snap to generate reports. In contrast, using a spreadsheet alone to generate reports is much more challenging. In conclusion, by using a good system for reports and data, landlords can quickly determine how their business is doing.

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General

Helpful Tools for Small Businesses

Tools for Small Businesses
There are many helpful tools that make running a small business easier.

Starting a business is not easy. Managing the day to day activity while trying to grow the business is not easy either. With today’s modern technology and innovative minds, there are many helpful tools for small businesses to make their lives easier. Here are a few to mention:

Accounting/Bookkeeping Tools

Keeping track of income and expenses is important for two primary reasons. First, you need this information to complete income taxes every year. Second, this information will give you an idea of how well your business is doing – Do you have profits? Are you growing? There is a variety of accounting tools available for small businesses. Some are free and focus on a target market like RentalIncomeExpense.com, which caters to landlords and rental property. Some are expensive but applicable to any business like QuickBooks. Whatever accounting tool you choose, know that this tool is pretty important and helpful, especially if you can run reports that summarize how your business is operating.

Communication Tools

Communicating with customers and employees is important. How you communicate and the ease in which you communicate can make running your business easier. Email is pretty standard and in many respects becoming more popular than telephone. Similar to accounting tools, there is a lot of choice with email providers. One of the most popular email providers is Google’s Gmail. For businesses, Google Workspace consolidates a number of tools, such as email and storage, enabling you to better manage operating your business.

Similar to email, electronic signatures are another paperless communication tool that can streamline your business. Whether you need signatures from employees or from customers, using electronic signature software will save everyone time. There are some esignature tools that charge a low flat fee like eSignToday and some that charge a recurring monthly fee like DocuSign.

The tools available make running a small business easier. Some are free and some are well worth the cost. Nevertheless, there is a lot of choice, and finding those that best fits your needs will put you on the road to running a successful business.

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Landlord Tips

Organizing Receipts for Landlords

Organize Receipts
Organizing receipts for landlords is important for running the business.

Landlording is a business, so organizing receipts for landlords becomes important. Businesses need to keep records of their activities, including receipts for purchases made. Receipts come in handy if you want to return an item. They especially come in handy if landlords are audited, as receipts show proof of purchase including prices paid. So what is the best way to organize receipts?

The best way of organizing receipts for landlords is the one which is easy and accessible. For example, you can keep receipts in a shoebox, file them in a three-ring binder, or take photos of them and store them in an online folder. Another tip is to organize them by date. If you file receipts away as you make purchases, they will automatically be organized by date making them easier and faster to retrieve. Landlords who track income and expenses using software like RentalIncomeExpense.com can get into a groove of recording the purchase in the software and then immediately filing away the receipt. The software will track the date of activity. When you need to pull a receipt, you just need to find it by date. Organize receipts by date, and you’ll spend little time on the hunt! Recordkeeping and organization make life easier!

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Landlord Tips

Renting to Tenants with Pets

Renting to Tenants with Pets
Renting to tenants with pets can be a win win for both landlords and tenants.

Landlords are in the business of providing housing in exchange for rent. Renting to tenants with pets has its pros and cons, but in the end, it can be a win win for both landlords and tenants.

Attract More Tenants with Pets

Those who own pets view their furry friends like children – important members of the family. Landlords who are willing to permit pets to reside in their rental property expand the size of their customer base. And having a larger customer base increases the number of potential tenants and thus strengthens the chance that your rental property will not remain vacant for long.

Increase Rental Income

Landlords can increase rental income by renting to tenants with pets. Due to the potential for additional damage to the property because of the pet, landlords can increase the rent amount or charge a pet deposit. Recording this additional income is easy, especially if landlords are using RentalIncomeExpense.com, which is free landlord rental income expense tracking software.

If pet owners are willing to pay a premium for their home, and landlords are willing to rent to tenants with pets, both are satisfied and a win win is for all!

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Landlord Tips

What is a Cap Rate?

What is a cap rate?
‘Cap rate’ is an easy term to understand

For a new real estate investor, the term ‘cap rate’ can be intimidating. Fear not! This term is easy to understand and we’ll explain how to use it.

Cap Rate is the Yield of a Property

Do you understand what the interest rate on a bank account or CD means? Do you understand what the dividend yield on a stock is? If so, you already understand what cap rates are. They are the yield (in percentages) or investment return of a property.

Here it is as a formula:

Cap Rate = (All income minus expenses / Property Market Value)

Let’s look at an example. If a property’s value is $100,000 and, for a given year, after all expenses are subtracted from all rental income, there is a net income of $10,000, then the cap rate of that property is 10% ($10,000/$100,000).

How Is This Used?

Investors compare cap rates when evaluating different properties on the market. Generally, higher cap rates are more desirable. However, just as a higher return can be a signal of risk, properties with high cap rates can often be more risky. For example, an investment may have only a single tenant paying all the rent or is located an area with declining economic prospects.

That’s it! Easy Peasy, right?

Now you know what cap rates are, how to calculate them, and how they are used as a comparison tool.

If you are looking to sell a property that you already own, it is important to track your income and expenses so that you can properly calculate your property’s cap rate. There are many tools to do this. RentalIncomeExpense.com is one such free online landlord software tool that tracks rental property income and expenses.

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Landlord Tips

Free Ways to List Your Rental Property

Free Ways To List Your Rental Property
There are great free ways to list your rental property!

At RentalIncomeExpense.com, we are all about free ways to improve landlording. After all, our rental income expense tracking service is free for all landlords and property managers. So, given that, what are the best free ways advertise vacancies?

Zillow is No Longer Free

Zillow used to be a great way to list your rental property for free. Unfortunately, Zillow now charges $9.99/week per rental property to advertise it on their Website.

If your rental market is pretty strong, you might not want to pay to advertise on Zillow when your property can be rented using other, free sites.

Free Rental Property Listing Websites

Fortunately, there are many ways to list your rental property for free. Here are three of the best:

  • Facebook Marketplace: Using your Facebook account, go to “Facebook Marketplace”. From there, go to a category called “Property Rentals.” There, you can easily create a new listing for your rental property. Facebook Marketplace is widely used. Best of all, Facebook Marketplace does not charge any listing fees.
  • Nextdoor: Using your Nextdoor account, go to “For Sale & Free”. From there, click the “Post a Listing” button. Finally, choose the category of “Property Rentals”. Nextdoor is increasingly popular. And, just like Facebook, Nextdoor does not charge a listing fee.
  • Craigslist: One of the oldest and most popular sites, Craigslist is still a way to list for free in most places. The exception is that apartment rentals in Boston, Chicago, and New York require a $5 listing fee. Outside of those cities, Craigslist rental property listings are free.

As you can see, when you need to list your rental property, there are some great free listing services out there. And, once your rental property is leased, don’t forget to track your rental property income and expenses with the free RentalIncomeExpense.com service!

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General

Automatic Landlord Income Expense Tracking

Landlord Income Expense Tracking
Automatic and free landlord income expense tracking software makes life easier.

As we’ve already discussed, landlord income expense tracking is an important yet time consuming task for landlords. With all of the options available from a worksheet to landlord accounting software, each one has its pros and cons. We are going to highlight two major pros for landlords using RentalIncomeExpense.com – automatic recording of information and price.

Automatic Landlord Bookkeeping

If landlords want to save some time on tracking rental income and expenses when using RentalIncomeExpense.com, then they should use ClearNow for online rent payment. Rent collected via ClearNow is automatically recorded as income in RentalIncomeExpense.com. Furthermore, fees paid to ClearNow to collect rent online are also automatically recorded in RentalIncomeExpense.com. So just by using ClearNow, landlords eliminate the need to manually record rental income and the associated expense and thus save time.

Free Income Expense Tracking

RentalIncomeExpense.com is free rental property software. It’s hard to beat free. Many will ask, “What’s the catch”, when something so valuable is free. Believe it or not, there is no catch. Designed for landlords, RentalIncomeExpense.com is simple yet powerful landlord accounting software. Because it is free, landlords lose little when trying it out before taking out their wallets and purchasing software for their rental property needs. Beyond free, it also provides reports, like profit and loss, that tell landlords how well business is doing.

Information is powerful. A free tool like RentalIncomeExpense.com makes the mundane task of landlord bookkeeping all the more valuable.