Accounting - multiple bank accounts?

[MooseHead]

Hey guys, I'm looking for some feedback as to what has worked best for some of you. I am currently using my personal chequings account for rent deposits and expenses for my first duplex. However, I am getting my second property and would therefore would like to get more organized now and have a system in place to make accounting easier down the road.



What are some of the options you guys have used and liked? I thought of getting multiple chequing accounts but dont like the idea of carrying 7 debit cards around. Are there any better alternatives?



Cheers,



MH

 

[Alvaro Sanchez]

I have an account per rental or per JV to simplify accouting and purchases... each plastic can carry 3 accounts (cheque, savings and other) at least with TD. I made sure to label each plastic with the property address so that I avoid mixing up purchases when buying stuff for a given property.



I associate ONE plastic for internet access and I can see all my accounts, I also renamed them with the address of each property.


I also use TenantPay and associate each unit/tenant combination to the proper account so that when payments are received they all go to the right accounts. I also give void cheques for each financial institution for mortgage payments.


While you trying to automate everything, one of my JV partner is good with numbers and organization so he does the bookkeeping for all properties.


My main focus is not to complicate the process by labelling everything and making the bookkeeper life easier.

 

[DenisEncontre]

[quote user=asanchez]

I have an account per rental or per JV to simplify accouting and purchases... each plastic can carry 3 accounts (cheque, savings and other) at least with TD. I made sure to label each plastic with the property address so that I avoid mixing up purchases when buying stuff for a given property.



I had an acount per rental or per JV and came into big problems when the JV had multiple properties with me. Keep it as simple as possible with 1 account and 1 set of accounting files per property . This will ensure that you don't mix things up and your bookkeeper, accountant and your sanity will love you for it.

 

[Thomas Beyer]

NEVER EVER mix personal accounts with business accounts, even if the real estate is held personally, especially if JV properties are involved !



Since interest gets credited and debited, it is paramount to show what it is used for.



Thus, a new bank account for each JV partner. Perhaps OK to mix 3 properties with one partner in one account if split is the same (say 50/50).

 

[TodorYordanov]

Here is a tread from awhile back where I outlined how I set up my President Choice accounts step by step.



Still works today.

 

[JoeRagona]

I'll add to Todor's great thread...I just posted this on my blog



http://engagedinvestor.ca/2011/09/tips-for-real-estate-bookkeeping-21/



enjoy

 

[moparcanuck]

I have to agree with everyone here. Different account for each JV, and certainly NEVER mix business with personal banking. Not only is it hard to keep track of, it's a nightmare if/when CRA comes calling.

 

[MooseHead]

Thanks for the tips everyone. I looked into ING since they offer a free chequings account but they don't offer what I'm looking for. I don't think I've got a PC near me so it wouldn't work out and I want to be able to access the $$ right away if I need it. I may approach Scotia since I've got my two mortgages with them. Maybe I could get some free chequing accounts out of it!