Real Estate Accounting and Banking Set Up
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- เผยแพร่เมื่อ 19 ม.ค. 2021
- Quickbooks Desktop Pro Plus 2022 for PC's - Buy on Amazon - amzn.to/3BoGQK2
Quickbooks Desktop Mac Plus 2022 - Buy on Amazon - amzn.to/3GAMyMK
Open a bank account with Chase and receive a $225 bonus - accounts.chase.com/consumer/r...
I explain how I set up bank accounts and accounting for my real estate portfolio. Also, how to set up an LLC and get an Employer Identification Number for a LLC.
My Accountant:
Christine Langner, CPA
Tax Manager, Wipfli LLP
100 Tri-State International, Suite 300
Lincolnshire, IL 60069
clangner@wipfli.com
Office: 847.941.0236
www.wipfli.com
Tenant Cloud Property Management
Landlords, I highly recommend TenantCloud for your property management needs. It has a great application process with credit/background checks, lease management, maintenance requests and more. Use this link for a free account (not a trial account) and see for yourself - home.tenantcloud.com/signup?a...
Kenton Realty Group - kentonrg.tenantcloud.com/
Contact Kenton Knows
Email: Kentonknows@gmail.com
Facebook Group: / kentonknows
Twitter: / kentonknows
Instagram: / kentonknows
Reddit: / kentonknows
Medium: / kentonknows
Quora: kentonknowsrealestate.quora.com/
DISCLAIMER
I am Not a CPA, Attorney, Insurance Agent, Contractor, Lender or a Financial Advisor. None of the information in these videos shall not be construed as tax, legal, insurance, financial, engineering, construction or any other advice of any kind. This TH-cam video is for entertainment purposes ONLY. If you need any professional advice, please contact a professional in the that specific subject matter. Linked items may create a financial benefit for Kenton Realty Group, LLC. Kenton Realty Group, LLC is a licensed real estate brokerage in Illinois License 481.010945.
This is not an advertisement of property for sale and any mention of any real estate shall not be construed as anything other than an opinion for entertainment purposes only.
#realestateaccounting #investmentproperty #incomeproperty real estate, real estate accounting, real estate bank accounts, LLC bank accounts, EIN for real estate, real estate LLC operating agreement
Please hit the LIKE!!!
Hey Kenton! Great job with all the videos. You're doing a really good job on format, length, and picking topics. One thing you may want to consider is figuring out how to time-stamp your videos, so people can jump to a specific topic within your videos. Keep up the good work!
Thanks so much, I really appreciate the support and helpful advice!
#RealEstate #iBuyers
I'm not sure what this comment means, but thanks for watching and commenting
Thanks for the video. This is the information that was looking for.
You are welcome, glad to help
I needed this video! Thank you
So glad it helped you!
Thanks for sharing, Kenton!
Glad you liked it!
This is great. Wow. Thanks
Glad you liked it!
Great tips
Thanks so much for watching and commenting!
Thanks so much for your videos. It is so helpful that you share not only what you do but the detailed steps on how to accomplish. Could you do a video on how you pay yourself?
Thanks so much for watching, commenting and your kind words of support. I essentially pay myself whatever is extra each month in each property account. Of course, if I know there is a big expense coming up, I’ll leave more money in that account. You might also like this video on how I handle reserves - th-cam.com/video/L9wrPQnjz3Q/w-d-xo.html
Nice !!
Thanks, glad you found it helpful!
Wonderful video. Very tactical and helpful tips. You should write a book to share this wisdom.
So glad you liked it, thank you so much for the kind and supportive words. I will definitely need to think about writing a book someday, thank you!
I can see this being a good series, some slides from the software would be nice.
Thanks so much for the feedback, I will definitely look into that!
Good info. Thanks.
You bet
Hi Kenton - I just stumbled upon your channel. Having just watched one video, you have got my interest and I am going to watch others too. I liked how succinctly you described your process. Nicely done! Given your process of charging expenses on the credit/debit card for a particular property, I wonder how many cards you carry in your wallet, given the size of your portfolio?
Good question - it's honestly a lot, since I also have a real estate brokerage company and more than one personal credit card in addition to one per building. Thanks for watching and commenting, glad you liked the content!
did you ever do a video on the categories?
I think you are looking for this video - th-cam.com/video/afQ4wlJxogE/w-d-xo.html
Thanks
Welcome
Awesome video as always. I have questions so ill ask them on the FB page.
Thanks so much, glad you liked it, thanks for watching!
Kenton - thanks for the video. I'm also a landlord in Chicago with several properties. I just created a series LLC and am about to set up a couple individual series and transfer my properties over. However, I just heard somewhere that most major banks (e.g. Chase, Bank of America, etc.) won't let you open individual bank accounts for series LLCs. Have you run into this issue with Chase for your series LLC?
The banks can be weird about single member LLC's sometimes - I'm not entirely sure why, but I was able to get individual bank accounts and credit cards set up with Chase for my 8 properties, the "parent" LLC and my brokerage company. It seemed like they changed the rules a couple times as I was adding properties, so the process was a little different, but they did always look up the LLC on the state website to be sure it was registered. So don't try to open the account until you can view each sub LLC company on the secretary of state website, which can take a few weeks from when you send in the paperwork.
@@KentonKnows thanks! super helpful. I'll get the individual series set up in the meantime and will ping you via DM or email if I have additional questions
@@athlonmj sounds great, good luck!
This is great! Thanks for putting this together. It’s now been a few years since the video, did you end up moving out of quickbooks?
Also to confirm for your holding LLC, does that LLC own each of the property LLCs or do you have them in your name?
I actually just moved to wave apps this year and hope to record a new video on it soon.I have a series LLC that has each property LLC in it
@@KentonKnowsi use wave as well for another business and love it so far. Looking forward to your video! Do you happen to have a video of the cost to set up the series LLC with your attorney.
Hey kenton! - quick questio, do you use separate software pm and book keeping. Just want to make sure i understood that right
Yes, I use TenantCloud for property management and I used to use Quickbooks for accounting, but just recently switched to using wave accounting.
Am I understanding correctly that you get a new EIN for each sub LLC that you set up for each property?
And since you set up a bank account for each property, you would eventually have dozens of bank accounts if you scale?
Good question. Yes, I currently have one EIN per sub LLC and I currently have 8 buildings so 8 EIN's, plus one for my holding company and one for my real estate brokerage for a grand total of 10. On the scaling question, I have been thinking about it. For now, I plan to keep them in separate LLC's and EIN's, but if it gets to a point where I think there are too many, I have thought about doubling up with two properties per LLC. I haven't gotten to that point and I'm not really sure if it would really save me any time or money to start doubling up as all it would really affect would be one less bank account, but more confusing keeping the accounting separated by property within the LLC, unless I can just combine all expenses and income regardless of property kept in the LLC. I haven't worked through that yet, but it also isn't an issue for me yet.
@@KentonKnows That makes sense. I’ve read that one can use one bank account but would just need to keep very good accounting. I can see how that would be risky if you make a small mistake and commingle inadvertently. Would you mind me asking who set up your structure?
@@taylorjenkins2366 I set it up myself after reading about all the reasons why you don't want to co-mingle, so I thought this would be the most simple, easy way to keep everything organized and separate.
@@KentonKnows That’s awesome. I’ll have to do some more reading into how to do that. Thanks for all of the information!
Hi Kenton - great video! If I am just renting my personal home, should I open another checking account (business account)? Are there any book keeping/accounting strategies for personal home rentals that you would recommend? Thanks!
I think it’s much cleaner to keep all income and expenses from your rental/business separate from your personal. With only one property it’s unlikely you’d get audited, but it’s much easier if you have it all separate and it should make doing your taxes easier each year as well. You might want to also watch my tax video to be sure you have all your line items set up. I’d also consider using stessa for a free accounting software for your rental. Here is the tax video link - th-cam.com/video/afQ4wlJxogE/w-d-xo.html
@@KentonKnows Thank you, Kenton!
Does Chase hit you with a hard inquiry every time you open a biz CC? also do they ever decline CC for a new LLC?
Yes, I believe it is a hard credit pull for a new credit card. I’m sure they do deny some applicants, but I’m not sure what the criteria is as I’ve always been approved.
great video. thanks for sharing this. I'd love to hear more details about how the property ownership goes under the LLC in the first place. Do you actually purchase the property as the LLC? And if so, how does the LLC have enough credit to get the mortgage? Thanks again.
All but one of my properties have conforming loans, so I buy and then refinance them all in my name, then after the 30 year loan is in place, I do a quitclaim deed to transfer ownership into the LLC. The one commercial loan I have is in the LLC name, but like most commercial loans I had to sign a personal guarantee, so I'm not sure the bank really worried about the LLC having any real credit history. When I have to refinance the conforming loans, I quitclaim deed them back to my name, refinance and then quitclaim them back to the LLC.
@@KentonKnows ok, you need to do a video on this process to transfer them! i guess most loans have a due-on-sale clause that I thought would prevent that so I'm anxious to know more about this process.
@@FrankGraffagnino That's a great idea, I'll do that. But good news on the due on sale clause front, both freddie and fannie now allow you to transfer the deed to a LLC without triggering the due on sale clause. Fannie allowed it first and Freddie just changed it in 2020. I'll work on a video and provide the link for backup for both and I'm thinking I'll explain the exact process I go through to transfer the property from me to the LLC and back as needed for Refinances. Freddie and Fannie still won't let you get the loan while it is in the LLC, but don't have issue with you transferring it after closing.
@@KentonKnows interesting. Really looking forward to learning more about this
@@FrankGraffagnino I'm planning to post the Quitclaim to LLC video next Wednesday!
Wow! This is a LOT.
For sure! Thanks for watching and commenting, hope it helped you.
& did you still work a regular job after getting your fist rental property
I still work a day job today and I have 8 buildings with 31 class A apartments. Having a job allows you to get the lowest financing rates and for my personal situation, it is currently what is best for me. Here is a video where I touch on all my real estate related jobs and all the rental properties I have bought and currently own - th-cam.com/video/4fOrQyWMbEQ/w-d-xo.html
@@KentonKnowswow that’s very impressive do you mind me asking how you’re managing all of your properties, a full time day job, plus your family/friends and free time. I have 2 properties so far and I’m ready to start outsourcing already. Do you use VA’s to help with anything?
I use QB for mine but its getting way out of hand, so I'm thinking of moving to DoorLoop and integrating my QB account.
Let me know how it goes, looking for the same thing
Yes, I’d love to hear more about it as well, thank you in advance for sharing!
I’m 19 years old saved up 10k cash off buying fixing and selling dirt bikes I want to get into rental property but I’m not sure what to say at the bank
In my opinion, try to start with a house hack. That way you are buying a personal residence and you can rent out rooms or if you can buy a 2, 3 or 4 unit property, then you can rent out the other units. 4 units or less is still a residential mortgage and you can do a lower downpayment if it is your primary residence. Here is my house hacking video - th-cam.com/video/vCfbq24TbSI/w-d-xo.html
I live in CA. I purchased 3 rental SFRs in Arkansas and 2 in Tennessee. I would like to put each in an LLC. It costs $800 per year for each....or $4000 total every year. Is there a more cost-effective way to do this?
I’d look at a series LLC. You’ll need to talk with an attorney to see if you should do one series per state or not. I have all my properties in one series LLC with “sub” LLC’s for each property. You may also like this video I did on LLC’s - th-cam.com/video/djYrwwcAtVA/w-d-xo.html
What should we do if our state does not allow a Series LLC?
I recommend talking with a local attorney, sorry I am not qualified to give you a recommendation on that. I was just sharing what I did and why.
Do you make a bank account for each property?? Is there a guide on the backend steps. Processes.
Yes, I do have a separate bank account and credit card per property and tried to explain it this video. What other steps or processes are you asking about? I also use TenantCloud as my property management system. th-cam.com/video/ZG7xeT1fPpU/w-d-xo.html
I also explain how I use a HELOC for my reserves in this video - th-cam.com/video/L9wrPQnjz3Q/w-d-xo.html
Would you recommend for first rental?
On your first rental, this is probably overkill. You will just need a way to track all expenses related to the rental, so I think setting up a 2nd personal account would work just fine for your first rental. As you grow, you will want to separate things more, but no need to go overboard until then.
Holy shit thanks kenton!
You are welcome, so glad you found it helpful!
@@KentonKnows hey kenton. Tomorrow going to sit down with my mortgage guy at the bank. I'm looking into getting my own properties to rent out.. I do not own any at the moment. Im brand new in this and teaching myself everything.
Do you have or could you make a video about the correct questions to ask so I can get optimal results?
@@dylangentry8614 Here are a few you might want to start with:
Buying your first investment property - th-cam.com/video/JZTjP-c7eko/w-d-xo.html
HouseHacking - th-cam.com/video/vCfbq24TbSI/w-d-xo.html - I think this is a great way to get into real estate investing - it is how I started
Ranking real estate financing options - th-cam.com/video/9rKDqqRZV4o/w-d-xo.html - this video ranks all of your real estate financing options
Evaluating a Real Estate Investment - th-cam.com/video/nJZw_BEaUVs/w-d-xo.html
I'll try to do something for meeting with a mortgage broker. Definitely meet with your bank, but don't have him/her run your credit till you know a little more about what you plan to do and are sure you are moving forward with it. Before securing a loan, be sure to shop with several banks, brokers and credit unions. Depending on the interest rate environment, they may not all have the same deals. Credit unions are usually slower to react, so in rising interest rate environments, you can usually get a better deal at credit unions and when rates are falling, banks and brokers usually have the better deals.
I currently do everything in Google Sheets, but I'm thinking about moving to Stessa. I figure it will allow better data visualization and insights and facilitate taxes. Plus at some point I intend to move over to getting things out of my name and into an LLC.
Great, love to hear how you like Stessa. I'm working on a quitclaim to LLC video now. You might like my conforming loans and LLC video - th-cam.com/video/0KDW9onvSHs/w-d-xo.html
@@KentonKnows One additional question - from my brief time using TenantCloud, it appeared to also handle accounting as well. Expense and income tracking, etc. Any reason why you need Quickbooks (or Stessa) on top of it?
@@mr.g937 That is a great question. Yes, Tenantcloud does have some accounting built in and that would be awesome if we could just use one solution. However, the problem I have with it is I can't download transactions directly from my bank and then categorize them. I could enter them in directly and there may be a way to do a bulk upload, I honestly haven't looked into it as I just wanted to be able to have the program sync directly with the bank and automate some of that process, which quickbooks does a great job with and I believe Stessa does as well.
I just bought my second home and I want to rent my first home. What should I do first. Do I apply for a llc, apply for a ein number, open a business account using a brick and mortar bank, and then hire a property management company.
If you just have one property I wouldn’t bother with the LLC or a property manager. You can handle it yourself and be sure to get a landlord insurance policy. This might help as well - th-cam.com/video/CFY1x_cRjcA/w-d-xo.html