Are you currently keeping track of expenses in a separate spreadsheet, independent of your rental management tools?
With TurboTenant, you can effortlessly document property or business-related expenses alongside your payment records.
TurboTenant recently partnered with REI Hub to bring you intuitive accounting software built for landlords, which includes automated expense tracking. Learn more. New offer: TurboTenant users get 50% off their first two months of REI Hub.
To locate expense tracking in your dashboard, navigate to the left-hand menu and click on the Expenses tab, under the Financial section.
Creating an Expense
First, record an expense using the Add Expense button on the lower portion of the info box.
Next, enter the information related to the expense: the date of expense, the amount paid, the associated property, and the associated category (corresponding to the categories found on an IRS Schedule E form).
You can also provide additional information that will help you understand the expense at a later date (description, notes, receipts/documents).
Finish by clicking Add Expense
After you create the expense, you will receive confirmation that the expense was added, and it will appear in the Expenses table.
To access these functions, click on the gray triangle button on the far right. Edit and Delete should toggle and appear.
Edit an Expense - Click on the expense you want to edit, and click on the Edit button in the dropdown. You should be able to freely edit the information and add more if you wish.
Deleting an Expense - Click on the expense you want to delete, and click the "Delete" button. We will confirm with you that you'd like to delete the expense. Please note: A deleted expense cannot be recovered.
Filter your Expenses - You can find the filters above the expenses table, then filter your expenses by property, categories, and date ranges. You can apply more than one filter at a time.
Exporting Expenses - Click on the Export button to the right and above the expenses. You will receive a CSV of the view, including active filters. If you want all of your expense data, ensure no filters are active. Conversely, if you want to export with filters on your export, select the relevant ones before you export.
IRS Categories Explained
Advertising – Include all general expenses for marketing and advertising, such as renting yard signs, advertising on specific websites or publications, purchasing business cards, and sending out mailers.
Auto and Travel – Include all standard and essential auto (to be further discussed) and travel expenses necessary for the upkeep of your rentals. This should exclude auto and travel costs related to the initial purchase of your first rental property or expanding your rental business into a new area. Additionally, include 50% of travel meal expenses.
Cleaning and Maintenance – Include all costs associated with cleaning to prepare a unit for a tenant or after a tenant vacates, including any applicable maid expenses. Additionally, include maintenance expenses such as painting, lawn care, and minor upkeep costs for the building, appliances, and equipment.
Commissions – Include realtor or property management commissions paid to find a tenant for your unit.
Insurance – Include homeowners, hazard, and flood insurance expenses in this section. Do not include prorated amounts for annual insurance. Only report the actual amount you pay to your insurance company, excluding any payments made into escrow.
Legal and Professional Fees – Include costs associated with attorney fees, accounting services, and expenses related to business and financial planning specific to your rental properties.
Management Fees – Include the expenses for hiring an agent or property manager to oversee your rental property. This should encompass any costs associated with their services, including any special service calls made by the property manager to inspect the rental.
Mortgage Interest Paid to Banks – Include the interest amount reported to you by the bank on Form 1098. This should encompass the total interest you have paid to the bank throughout the year, including any interest paid during the closing process.
Other Interest – Include the interest amount paid to third parties, which may include private investors, businesses, crowdfunding platforms, or relatives. Ensure that you have provided these individuals or entities with a Form 1099, indicating the interest you have paid them. It is important to note that without a Form 1099 in this scenario, you may not be able to substantiate the deduction.
Repairs – Include all property repairs that do not qualify as capital improvements. These expenses should pertain to minor repairs and exclude major replacements such as flooring, roofing, and so on. Additionally, you may include De Minimis Safe Harbor expenses here if they amount to less than $2,500 and you have made the annual election.
Supplies – Include the cost of incidental materials and supplies such as paper for printing, small tools, and other small miscellaneous materials that don’t fit into another category.
Taxes – Include all tax-related expenses associated with owning and operating the rental property. This encompasses property taxes, school district taxes, and any special easements or land taxes. Exclude income taxes from this category.
Utilities – Include utility expenses that you have personally paid, regardless of whether the tenant has reimbursed you for them. Exclude utility expenses that the tenant has solely paid for without your involvement. The reason for including reimbursed utility expenses is to report the reimbursement as income on the top section of IRS Schedule E and offset that income with the corresponding expense you incurred.
Depreciation Expense – Include the depreciation expenses that you have calculated. Depreciation is a crucial component of IRS Schedule E, so ensure its accurate reporting.
Other (list) – Include all additional expenses related to the operation of the rental property that does not fall into the categories above. These expenses can include bank fees, educational expenses, HOA fees, subscriptions, book costs, De Minimis Safe Harbor (if not already reported under repairs), meals and entertainment, and gifts to clients or tenants. It is important to itemize each of these "other" expenses on a separate page.