Question i got from Ron
---------------------------------------
MIke,
I e-mailed you last week but did not have my nephew's e-mail address. It is Ronn@ronnproperties.com under Ron Harris in Oklahoma City, Oklahoma.
My question is on personal cash brought into the company to pay for a property, ...
does it go into the cash from me or should it be in the investment under a personal draw account?
ANSWER #1: I do not understand "personal DRAW" account... (investors don't understand that language either) HOWEVER, investor do understand "Cash From Me"... let's try to clear this up..... if you take some money from your personal banking account and deposit into your real estate operating account to buy an investment property.... then in this situation, using your Investor Books file, and Make a Bank Deposit into your real estate checking account, and the money will be coming from "Cash from Me" account...
on another note: If you are using your Home Equity Line of Credit to fund a deal.... create a HELOC liability account under the proper lender... then make your bank deposit into your real estate checking account pulling money from the HELOC liability account...
Also if you paid cash for a property and refi it do you do a journal entry to zero out the for hud and enter the refi?
ANSWER: I recommend to investor to never do "journal" entry. ... I am really having a hard time trying to understand your question... If you paid cash for a property.. (GREAT) and then "Refinance" (i assume to get your cash back)....... the next part of your question does not make any sense.... "to zero out the hud?" You NEVER change your HUD 1 settlement statement.... If you change your HUD 1, it defeats the whole purpose of using this system.... you are simply entering the HUD EXACTLY as it appears, line for line, penny for penny.... NEVER alter the hud 1... if your CPA finds out you are changing them... you will have to produce HUDs to your CPA at tax time....
Just enter the closing statement as it appears... use the real numbers and not phantom numbers.
Showing posts with label QuickBooks Investor Books. Show all posts
Showing posts with label QuickBooks Investor Books. Show all posts
Wednesday, June 24, 2009
Wednesday, February 25, 2009
QuickBooks Questions
Mike,
I bought your Investor and Tenant Books last year (the 5mWAP system using QuickBooks Pro... http://www.5mWAP.com ).
This is one of the best products I've implemented in my real estate system.!
I've thoroughly enjoyed using it this year in our business.
My questions are the following:
1. In following your All Star Plan in your book and the Christmas Credit, how am I supposed to categorize the credits that I give to tenants on the 13th, 25th, and 37th months?
A. You could simply enter "All Star" (using a statement charge) and then describe the details o the discount in the memo field or description fiel and then enter the dollar amoount of the discount ad make sure you enter a "-" minus sign in front of the dollar amount... ... for example, if you wanted to give them a 10% discount on an $800 rent,
you would enter "ALL STAR"
description, earned 10% discount
dollar amount = -$80.00
this will automatically deduct this amount from the amount owed you for this billing period
I'm assuming this will also include the 2.9% rent increase too.
NO, No, Breisch... you will actually "edit" or modify the existing monthly recurring charge for the rent....
For example....On the 13th month, should I charge the normal rent plus the 2.9% increase and then on the next line on the register show a 10% credit of the Rent + 2.9% increase back to the account using the discounts feature? How do you normally show this on your books?
These are two totally separate independent transactions and procedures. Please do NOT try to combine them... just keep it simple and you will be happy.
2. Since this is my first full tax year with our business, I was planning on using TurboTax to calculate our personal and business taxes, as well as getting a CPA to do them too. Basically I just want to see if the CPA really gets us more money than we can do on our own.
Be careful here.... i do not know your CPA... Please make sure you get a Real Estate EXPERT CPA.... Remember, Veterinarians and Brain Surgeons are both called "Doctor"... which one do you want to work on your noggin?
The only problem I'm running into is that none of the Tax Line Items are declared in the Tenant or Investors Module.
I believe I remember you saying on the Getting Started Video not to add anymore categories into the list and that these Accounts/Categories would be the only ones we would need to run the business, except for adding the normal bank, mortgage, escrow etc accounts.
TRUE, the shorter the better.... if you are an avid and sharp Quickbooks user, you could assign tax form schedule specifici lines; however, i do not recommend it.. I highly recommend to have an expert, highly qualified REAL ESTATE CPA who happens to be an investor as well..
I was wondering why the Tax Line Items are not declared on any of the accounts/categories. Is it supposed to be that way? Some of the categories are pretty self explanatory as to what Tax Line Item goes with it... such as Advertising. You don't happen to have what category goes with what tax item do you?
Thank you so much for developing this easy to learn and use system.
Sincerely,
Breisch Stallings
Madison, MS
I hope this helps you Briesch!
Keep Cranking It
Mike Butler
http://www.5mWAP.com
I bought your Investor and Tenant Books last year (the 5mWAP system using QuickBooks Pro... http://www.5mWAP.com ).
This is one of the best products I've implemented in my real estate system.!
I've thoroughly enjoyed using it this year in our business.
My questions are the following:
1. In following your All Star Plan in your book and the Christmas Credit, how am I supposed to categorize the credits that I give to tenants on the 13th, 25th, and 37th months?
A. You could simply enter "All Star" (using a statement charge) and then describe the details o the discount in the memo field or description fiel and then enter the dollar amoount of the discount ad make sure you enter a "-" minus sign in front of the dollar amount... ... for example, if you wanted to give them a 10% discount on an $800 rent,
you would enter "ALL STAR"
description, earned 10% discount
dollar amount = -$80.00
this will automatically deduct this amount from the amount owed you for this billing period
I'm assuming this will also include the 2.9% rent increase too.
NO, No, Breisch... you will actually "edit" or modify the existing monthly recurring charge for the rent....
For example....On the 13th month, should I charge the normal rent plus the 2.9% increase and then on the next line on the register show a 10% credit of the Rent + 2.9% increase back to the account using the discounts feature? How do you normally show this on your books?
These are two totally separate independent transactions and procedures. Please do NOT try to combine them... just keep it simple and you will be happy.
2. Since this is my first full tax year with our business, I was planning on using TurboTax to calculate our personal and business taxes, as well as getting a CPA to do them too. Basically I just want to see if the CPA really gets us more money than we can do on our own.
Be careful here.... i do not know your CPA... Please make sure you get a Real Estate EXPERT CPA.... Remember, Veterinarians and Brain Surgeons are both called "Doctor"... which one do you want to work on your noggin?
The only problem I'm running into is that none of the Tax Line Items are declared in the Tenant or Investors Module.
I believe I remember you saying on the Getting Started Video not to add anymore categories into the list and that these Accounts/Categories would be the only ones we would need to run the business, except for adding the normal bank, mortgage, escrow etc accounts.
TRUE, the shorter the better.... if you are an avid and sharp Quickbooks user, you could assign tax form schedule specifici lines; however, i do not recommend it.. I highly recommend to have an expert, highly qualified REAL ESTATE CPA who happens to be an investor as well..
I was wondering why the Tax Line Items are not declared on any of the accounts/categories. Is it supposed to be that way? Some of the categories are pretty self explanatory as to what Tax Line Item goes with it... such as Advertising. You don't happen to have what category goes with what tax item do you?
Thank you so much for developing this easy to learn and use system.
Sincerely,
Breisch Stallings
Madison, MS
I hope this helps you Briesch!
Keep Cranking It
Mike Butler
http://www.5mWAP.com
Sunday, February 22, 2009
QuickBooks Question on 5mWAP Investor Books
Quick Question: I'm a current user of the 5m and was wondering how you handle using Lines of Credit.
Do you tack it to a mortgage RE area or seperate it?
I have 1 LOC that has collateral and other unsecured LOC's.
Some interest only, others P/I payments with no 1098's!
I think I have to do the monthy P/I tracking.
The interest only should be easy.
Ron Harris
----------------------------
ANSWER: Great question Ron; however, we need a tad bit more info to get it all right.
For example, if your LOC is secured with a piece of real estate... then i would flag it to that property...
Make it a sub-account of the lender involved, and using the naming format found in your manual, include the property... ultimately, every transaction in this LOC will be flagged to that property.
Example 2,... if you have a LOC that is not secured by a piece of real estate.. simply make the borrower to be included in the naming format found in your manual (sorry about the grammar there)... you can then select to use any interest to manually flag it to the property or entity involved.
Keep On Cranking It Ron...
Mike Butler
-----
To Get Your Own 5M WAP Wealth Autopilot System, the Only Complete System for Investors using QuickBooks Pro.. visit http://www.5mWAP.com
Do you tack it to a mortgage RE area or seperate it?
I have 1 LOC that has collateral and other unsecured LOC's.
Some interest only, others P/I payments with no 1098's!
I think I have to do the monthy P/I tracking.
The interest only should be easy.
Ron Harris
----------------------------
ANSWER: Great question Ron; however, we need a tad bit more info to get it all right.
For example, if your LOC is secured with a piece of real estate... then i would flag it to that property...
Make it a sub-account of the lender involved, and using the naming format found in your manual, include the property... ultimately, every transaction in this LOC will be flagged to that property.
Example 2,... if you have a LOC that is not secured by a piece of real estate.. simply make the borrower to be included in the naming format found in your manual (sorry about the grammar there)... you can then select to use any interest to manually flag it to the property or entity involved.
Keep On Cranking It Ron...
Mike Butler
-----
To Get Your Own 5M WAP Wealth Autopilot System, the Only Complete System for Investors using QuickBooks Pro.. visit http://www.5mWAP.com
Wednesday, February 4, 2009
QuickBooks Question on Investor Books
Mike,
In my paper checkbook for my duplex, I show a separate account on (paper only) for security deposits.
I keep the balances separate, so I don't add this balance to my regular checking account accept when balancing the account, but the money is still in my checking account for backup so I don't overdraw the account.
Is it possible in Investor Books to have a primary checking account with a Security deposit account inside of this checking account? How could you show a transfer from the checking account to the sub-security deposit account.
Or
Could I set up 2 separate accounts inside of one Bank so I could transfer funds back and forth in Investor books, but keep them as one inclusive account at the bank? Would this work or not?
Thanks,
Mark S.
Indiana
Answer: Excellent Question Mark!
Couple of things here.
1.) Double and Triple Check with your Landlord Tenant Laws for your town and state... Many states including mine, require a separate account used exclusively for Tenant Security Deposits... so if this is the case in your town... this is your answer.
2.) Regarding "sub-accounts" within a checking account... yes you can Mark.. the easiest way would be to create a bank account.... then create a sub account and call it checking and another sub account called security deposit... this would then show how much in your "checking" part and how much in your "security deposit" part and the two combined would be displayed as a balance in the bank account... it would look something like this..
Bank Account...... $10,000
- checking .... $7,0000
- security dep..... $3,0000
or simply open another money market account and call it security deposit.
Keep Cranking It
Mike Butler
Get your 5m WAP system today at www.5mWAP.com
In my paper checkbook for my duplex, I show a separate account on (paper only) for security deposits.
I keep the balances separate, so I don't add this balance to my regular checking account accept when balancing the account, but the money is still in my checking account for backup so I don't overdraw the account.
Is it possible in Investor Books to have a primary checking account with a Security deposit account inside of this checking account? How could you show a transfer from the checking account to the sub-security deposit account.
Or
Could I set up 2 separate accounts inside of one Bank so I could transfer funds back and forth in Investor books, but keep them as one inclusive account at the bank? Would this work or not?
Thanks,
Mark S.
Indiana
Answer: Excellent Question Mark!
Couple of things here.
1.) Double and Triple Check with your Landlord Tenant Laws for your town and state... Many states including mine, require a separate account used exclusively for Tenant Security Deposits... so if this is the case in your town... this is your answer.
2.) Regarding "sub-accounts" within a checking account... yes you can Mark.. the easiest way would be to create a bank account.... then create a sub account and call it checking and another sub account called security deposit... this would then show how much in your "checking" part and how much in your "security deposit" part and the two combined would be displayed as a balance in the bank account... it would look something like this..
Bank Account...... $10,000
- checking .... $7,0000
- security dep..... $3,0000
or simply open another money market account and call it security deposit.
Keep Cranking It
Mike Butler
Get your 5m WAP system today at www.5mWAP.com
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