Your rental property can be a great source of passive income, but that doesn’t necessarily mean you won’t have to work for that revenue.
There’s a great deal of administrative work involved in managing any rental property. However, if you create a system for handling these details in advance, you can save time and money in the future.
Treat Your Rental Property Like a Small Business
You should treat each rental property you own as though it’s an independent small business. This involves opening bank accounts for each property and keeping track of rental income, deposits, and expenses. If you maintain meticulous records for each property, you’ll find that it’s easier to file your taxes at the end of the year. (more…)