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The Importance of Accurate Rental Property Accounting for Dallas Landlords

The Importance of Accurate Rental Property Accounting for Dallas Landlords

How much was your rental income in the last 12 months?

If you cannot give a definite answer without going back to do some calculations, you certainly don't take rental property accounting seriously. Yet, like every business owner, you're supposed to keep your books in order.

Understandably, keeping tabs on cash inflows and outflows might not be your favorite activity as a landlord, but whether you're a numbers person or not, it's prudent to get the accounting right.

Read on for a few compelling reasons to prioritize accounting for your Dallas rental property.

Maximize Your Rental Income

As a landlord, you're always looking for ways to generate more revenue from your rental property. But it won't matter what strategies you implement. If you're not staying on top of bookkeeping, it will be challenging to increase your rental income.

When you're keeping tabs on the financial books, you'll have a clear picture of how much the property is bringing in at any given time. With this information, you'll be in a better position to create smart income goals. For example, you can resolve to increase your rental income by 10% over the next year.

Minimize Your Operating Expenses

One of the reasons you might not be achieving your rental income goals is that your operating expenses are higher. But you won't know this if you don't know how much you're spending on things like repairs and maintenance, property marketing, and outsourced management services.

Proper rental property accounting enables you to have a detailed look at your expenses and determine whether they are where you want them to be. The goal is to keep them as low as possible without affecting service delivery tenants, so you can quickly find ways to reduce them.

For example, if your records show that you're spending a lot of money on maintenance and repairs, you could investigate why that's the case and take corrective actions.

Minimize Property Taxes

Dallas landlords have both federal and state rental income taxes to deal with every year. That's the bad news. The good news is you're entitled to tax deductions that can significantly reduce your liability.

To take advantage of these taxes though, you need to have accurate records of your expenses. The IRS is going to need proof that you indeed incurred those expenses before accepting your claim.

A requirement of rental property accounting is property record keeping. As such, if you're keen on accounting, you'll likely have all the documentation you need to make the most of your tax deductions.

Be Keen on Rental Property Accounting

Landlords wear many hats and you might be tempted to overlook some functions. Rental property accounting is one of those functions you must prioritize. You'll earn more rental income and increase your chances of being a successful landlord if you're keen on your financial books.

If you're unable to, you have the option of outsourcing it to a professional property management company. In Dallas, look no further than Evernest.

Established in 2008, our company now manages over 16,000 properties. The experience we've gained over the years is reflected in all our offerings.

Get in touch to learn more about our services.

Spencer Sutton
Director of Marketing
Spencer wakes up with marketing and lead generation on his mind. Early in his real estate career, he bought and sold over 150 houses in Birmingham, which has helped him craft Evernest marketing campaigns from a landlord’s perspective. He enjoys creating content that helps guide new and veteran investors through the complexities of the real estate market, helping them avoid some of the pitfalls he encountered. Spencer is also passionate about leadership development and co-hosts The Evernest Property Management Show with Matthew Whitaker. Spencer has traveled to some of the most remote parts of the world with a non-profit he founded, Neverthirst (India, Sudan, South Sudan, Nepal, Central African Republic, etc..), but mostly loves to hang out with his wife, kids, and the world’s best black lab, Jett. Hometown: Mtn. Brook, Alabama