Need advice on how to post security deposits "not returned" in full to tenant.
Are damages considered an expense or income? I am told it is income! Do I transfer this income amount to the general checking account to pay for expenses?
Is a lease forfeit (without damages) considered an expense or income?
What is the simpliest way to accomplish this in QB?
Need advice on how to post security deposits "not returned" in full to tenant.
Are damages considered an expense or income? I am told it is income! Do I transfer this income amount to the general checking account to pay for expenses?
Is a lease forfeit (without damages) considered an expense or income?
What is the simpliest way to accomplish this in QB?
Part of your problem is confusion over multiple usages of the same terms, another part is lack of basic bookkeeping knowledge.
"Damages" to property is an event or series of events.
"Damages" that you pay to repair are an expense; it might help to refer consistently to such expenses as REPAIRS rather than damages.
"Damages" that you recover from your tenant are income, or a reduction of Repair Expense.
"Income" is reported on your Income Statement (sometimes also known by other terms such as Profit & Loss, Statement of Operations). Your bank balances are reported on your Balance Sheet. Thus you cannot "transfer income to a bank account", although an amount of money deposited or transferred to a bank account might be THE SAME AMOUNT as an amount of income.
Yes, you should transfer funds from the security deposits to your general checking account to pay for the repairs, assuming the money is now physically located in a different account. The following entries would be required:
- Pay the repairs.
- Transfer funds to General Checking from whereever the money is currently located, to reimburse for the repairs.
- Reduce the amount of security deposit and record this as income or a reduction of repair expenses.
As already advised by "vcard", a lease forfeit is income. (I am assuming you mean a payment the tenant has made to the landlord. I can't imagine how you could think this would be an expense.)
The above is based on an assumption that you are the landlord or keeping the books for the landlord. If you are the property manager or acting in some other capacity and keeping books other than the landlord's accounts, a different approach may be required.
The simplest way to accomplish these entries in QuickBooks is to find a competent bookkeeper, as you obviously lack the basic knowledge.
Are damages considered an expense or income? I am told it is income! Do I transfer this income amount to the general checking account to pay for expenses?
Is a lease forfeit (without damages) considered an expense or income?
What is the simpliest way to accomplish this in QB?
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