Save for Future Repairs using QuickBooks

If you are like the rest of us, you will agree that saving money is always a good thing. You’ll also know that repairs are inevitable when you own or manage properties. Wouldn’t it be great to be able to access money you’ve already saved for those repairs and not be caught by surprise? Here’s a tip for tracking savings for future repairs using QuickBooks.

Q: Hi, I own a few rental houses.  I am looking to set aside a certain amount of money each year for repairs and maintenance.  Let’s say $1,000.  If it’s not all used, I want to accumulate money for big repairs such as new furnace or roof.  How should organize this in QuickBooks?

Right now, I have just an account for under Other Current Liability called  “Future Repairs” with the properties as sub accounts below.  I need to post the $1,000, but it only has an option for Payees.  Additionally, how can I tie in an Accumulated Future Repairs fund?

A:  A liability account is created when you owe money to someone. That is, if the money is still in your checking account and you will likely spend it. For this purpose, create a Equity account instead.

Set up a new savings bank account and name it Reserve Fund – Repairs. Then create a corresponding account in QuickBooks. Transfer $1,000.00 from your regular checking account to the new saving account. Open the Banking menu and select Transfer Funds.

Since you will have money in savings for future expenses, transfer the amount to your checking account and write a check from the Checking account when you need to spend that money for a repair.

Gita Faust

About the Author

Gita Faust has over 30 years of accounting experience in the real estate and property management industry, Gita Faust is more than just a real estate investor; she is also popular for her work as an accountant, consultant, mentor, speaker, QuickBooks Top ProAdvisor, QuickBooks Solution Provider, member of Intuit’s Trainer/Writer Network, and, of course, author. Gita is well-known for her exemplary leadership and advisory skills. In fact, she even helped pioneer the adaptation of QuickBooks to suit the needs of professionals in real estate and property management. To share her knowledge she has written a series of courses titled Simplified Accounting Solution, which provides step-by-step guidance for those working with QuickBooks.

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