Real estate agents are passionate about homes and changing people’s lives, but not always about the complex financial side of running a business. Whether handling buying, selling, leasing, or managing a property, as a real estate agent, you are responsible for varying transactions, expenses, and income that can make keeping an organized business account challenging.
Understanding the challenges, income and expense types, and resources for running your real estate business is a great first step to accurate accounting. Partnering with All About Businesses and utilizing our unique, specialized experience in accounting is a great next step to making your business run smoothly and grow.
The Challenges of Real Estate Accounting
Not all accounting is the same for every industry, and the real estate business, in particular, has unique challenges. Expenses and income types can vary widely and must be classified correctly for an accurate picture of your company’s health and tax liability. With many real estate professionals working independently, separating personal and business accounts is essential for precise bookkeeping.
Another significant challenge for a real estate agent is large, inconsistent transactions. Property transactions tend to be high amounts, and when working with a real estate broker, you work on commissions that fluctuate in quantity and timing. Additionally, running a real estate company often involves multiple bank accounts and cards to keep straight. Trusting the professionals at All About Businesses to handle your real estate accounting means you are working with a team who knows these challenges inside and out and can help you ensure good financial health.
What Does a Real Estate Accountant Do?
An accountant with real estate experience not only brings confidence about your business’s financial health but can offer additional specialized services such as the following:
Financial Record Management: Our real estate accounting experts can maintain accurate, well-organized financial records to account for every transaction.
Improve Cash Flow and Performance Tracking: Understanding your cash flow and analyzing financial performance with the help of an accountant means accurate data you can use for budgeting and planning ahead for upcoming expenses.
Manage Expenses: Unusual or infrequent expenses can be challenging to track properly but are vital for financial health and taxes. A dedicated accountant can devote time to monitoring these expenses and classifying them correctly.
Bookkeeping and Documentation: Well-organized bookkeeping results in smooth access to information needed for accurate accounting. An All About Businesses accountant that does both bookkeeping and accounting frees up your time for focusing on the part of your business that matters most to you.
Leasing Expertise: If your business manages leased properties, an All About Businesses accountant can make managing the details of collecting rent and structuring lease agreements more painless.
Tax Preparation and Planning: With ongoing, accurate accounting, tax season doesn’t have to be a pain. Our team is knowledgeable about real estate tax specifics and can use the financial tracking they establish to maximize deductions and ensure you are fully prepared to pay what you owe.
Payroll Management: An accountant can take one more thing off your plate if you have employees in your company by handling payroll processing.
Common Expenses
As a real estate agent, your expenses can fall into multiple categories and fluctuate monthly. Common operating costs real estate agents may need to budget for include:
- Marketing budget
- Realtor association dues
- Continued education, such as seminars
- Legal fees
- Commission payment and desk fees
- Licensing
- Insurance
- Administrative help
- Staging costs
- Photography and video costs
- Transportation, including vehicle insurance and maintenance
Common Income
Depending on the type of real estate you focus on, common income streams can include:
- Commissions earned on transactions
- Team members paying commission
- Rental income
How to Use QuickBooks for Real Estate
All About Businesses utilizes QuickBooks as an aid for accounting management. It is popular due to its ease of use and adaptability and is relatively inexpensive. When you work with All About Businesses, we can set you up with the best practices for utilizing QuickBooks for your real estate businesses. An added benefit is that we can remotely access your QuickBooks for seamless accounting. Ensuring your financial records are up-to-date and your financial reports are accurate.
If managing the financial side of your real estate business is overwhelming and takes away from the part of your work that you love, All About Businesses can help! We use our experience to provide real estate accounting that results in challenges feeling nonexistent and financial success being within your reach. Contact us today for a free consultation or to get your further real estate accounting questions answered!
