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It’s never too soon to start preparing for the year-end work that needs to be done as a landlord and property manager. After all, big-box stores across the nation had started putting out their holiday stuff in the middle of October!Something you should watch for when looking for a good property manager (or something you should consider if you are one) is whether the end of the year consists of receipts thrown in a shoebox. A state of disorganization can cause more problems, especially if you are pushing the deadline of December 31. To avoid this state of disarray, use the following points as a checklist for buckling down and winding up in great shape at the end of 2011.
In addition to the typical monthly owner statements, you should send your owners a year-end statement that includes:
• A 12-month consolidated Operating Statement and a General Ledger Report
• A mortgage 1099-INT statement on any mortgages paid
• Any paid Property Tax Receipts
• A nice thank you note for their continued business throughout the year
While you’re writing thank you notes, be sure to send your tenants a nice year-end letter stating your appreciation that they continue renting a house or apartment from you. Explain in the letter the benefits that they can receive by claiming a deduction for the rent they have paid for the year (be sure to check with your accountant for specifics) and include:
• A statement to your tenant showing a total rent amount paid for the year of 2011.
The vendors you use each year should receive:
• A 1099-MISC statement for all monies paid to the Vendor over $600.
State laws vary, so again, make sure that you check with your accountant that you have provided the right statements to your owners, tenants and vendors. And remember, organisation is key. Keeping track of the yearly day-in/day-out activities that happen in a property management, or rental property situation can be easy if you have the right tools. Invest in a good software system that will allow easy reporting and tracking of all transactions.
Then sit back and let the new year roll in. Next year is projected to be a great year in real estate and the housing industry in general. We certainly have a lot to look forward to! Cheers!
Jessica Hichcock is a REALTOR® Broker and Property Manager/Landlord with Dizmang Properties, Inc. (www.getpaul.com) in Springfield, Missouri. She can also be found on Twitter as @SugarCube.