Record the Sale of Real Estate in Quickbooks Online

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I just sold a rental property! Watch me properly record the sale in QB Online.

[@Incomedigs]

Check out my end to end Quickbooks Training. www.incomedigs.com/reab ($50 off w/ code KZbin50)

[@danadenton92]

You have no idea how helpful this video has been!! Thank you so much!!!!

[@Incomedigs]

Thanks so much for watching! FYI...I'm hosting a free workshop today (and some other dates)...would love to have you join! www.incomedigs.com/reab3-webinar-registration

[@NoYouShmoopie]

I'm using a different set of Accounts, but this video is very very helpful!! Kudos to you

[@Incomedigs]

All good! I actually encourage my students to challenge themselves: Should we use the same accounts as Nick! Each of our businesses is unique...there is no "One size fits all" for COA in QBO!

[@alixandriaelder985]

Seriously a life saver... just could not quite get it to balance until I watched this video!

[@Incomedigs]

Yes! So happy to hear that you found the video helpful! Thanks for watching!

[@jacknelsen4519]

Thank you for your videos! Definitely considering your courses. For the realized gains, is that account setup as income, equity or something else?

[@Incomedigs]

Thanks for watching! Realized Gains would be "Income". Would love to have you in the course! Email me directly if you have any questions and/or would like to investigate an additional discount! [e-mail]

[@gregh.9056]

This vid is awesome. Thanks very much for sharing all that you do. I've been doing some contract work for a CPA and one of his real estate clients. Have a meeting with the CPA this week to review booking sales of properties. Now I feel very well prepared. Thank you!

[@Incomedigs]

Great to hear! Feel free to check out our end to end course! www.incomedigs.com/reab2

[@charliehu88]

excellent explanations. thank you.

[@Incomedigs]

Thanks for watching! please check out our end to end course on RE Accounting in QBO: bit.ly/reabcourse

[@user-ci7jn3bp8y]

THANK YOU!

[@Incomedigs]

Thanks for watching! bit.ly/reabcourse

[@littleboy6503]

Awesome video. Really very helpful.

[@arcproweldingschool]

Great video. Way better than QB help forum. Thanks

[@Incomedigs]

Thank you! So great to hear! Definitely check out our end to end Course: Real Estate Accounting Bootcamp! www.incomedigs.com/reab2

[@josesquiabro5819]

great video

[@Incomedigs]

Thanks for watching! Really appreciate the feedback!

[@michellemcdonald4735]

What if the proceeds from the sale do not get deposited in to the Bank that is tied to QBO? Where would I categorize that?

[@Incomedigs]

Hi! Good question! likely they are deposited into your personal account? If so, you would use some sort of "Owner Equity" account.

[@randiownbey7048]

Thanks for this video! Do you happen to have a video showing the sale of a rental property with a 1031 exchange?

[@Incomedigs]

Hi Randi! Thanks for watching! We have a comprehensive tutorial on 1031 exchange in our end to end accounting course: Real Estate Accounting Bootcamp: www.incomedigs.com/reab2

[@user-el8ru8cn7w]

When I follow this video, the income on my income statement is incorrect. I credit my asset (Land) account. I credit my Realized Gains account. When I credit my income (Sales) account, my credit side of JE is double the Debit side. If I take my Sales (income account) out of the JE, the JE balances, but my income is not reflected correctly in my income statement. The only income that is reflected in my income statement is the Realized Gains. What am I doing wrong? How to do I show the correct income while also getting the asset (Land) off my balance sheet?

[@Incomedigs]

Hi Ashley. If you wanted your Sale price to be the total revenue, you would need to "eliminate" land from your balance sheet by treating it as an expense. If you have "Land" listed as "Expenses: Purchase or Property", then you would be able to use the entire sales amount. Its all a matter of whether or not your costs of acquisition/ construction are included on your balance sheet or P&L. We discuss in great detail in our end to end course: Real Estate Accounting Bootcamp: www.incomedigs.com/reab2

[@user-yq6rf8db1i]

If a construction escrow account still has unused funds at the time of sale, do you credit the remainder from the escrow account to the principal for the loan payoff? Do you recommend doing that in a separate journal entry from the property sale journal entry? Thanks!

[@user-yq6rf8db1i]

And what if the remainder in the escrow account is greater than the remainder of the loan account principal?

[@Incomedigs]

@@user-yq6rf8db1i Yes! Your escrow balance should be reflected in the total payoff on the loan. You would credit the escrow balance to get it to 0...Debit your remaining loan balance to get that to 0...plus pay any outstanding interest (COGS). The net of these three should equal your payoff. If your escrow balance is more than the loan balance....the bank would owe you cash at the end! We discuss this in great detail in our end to end course: Real Estate Accounting Bootcamp: bit.ly/reabcourse

[@kinellkyramakkrearoca7280]

Hi, this is very helpful. Do we also record wholesale double closing like how we record the fix and flip closing statements? TIA

[@Incomedigs]

Hey! Thanks for watching! Yes...pretty much. For a double close...you will have two transactions in QBO: 1. Purchase 2. Sale. Because the transactions are happening virtually at the same time...you can record everything as revenue/ Expenses or COGS (no need to use the balance sheet). You will not need to "0 out your balance sheet" on the sale closing. Simply record the Sale price as your revenue...any associated costs as well. You will have a nice neat P&L for the project.

[@Incomedigs]

Definitely check out our end to end Course: Real Estate Accounting Bootcamp! www.incomedigs.com/reab2

[@findingtina7967]

The expenses that the buyer had regarding the property, should those be on the P&L? I have the expenses from the bank feed categorized on the P&L. Now I’ve sold and I need to remove the asset from the balance sheet. While I understand what you are doing I am not sure what to do with the expenses. HELP!

[@Incomedigs]

Hi There! If you put your closing costs on the balance sheet...this increases your basis. Your calculation of "realized gains" will account for your entire basis....purchase, closing costs, etc. These expenses will find their way to the P&L by way of a lower Realized Gains.

[@findingtina7967]

Thank you!

[@Mrspaige81]

How do you categorize sellers credits in Quickbooks?

[@Incomedigs]

Seller Credits can be logged against your closing costs! You can simply record them in the "Credit" line of the journal entry.

[@stephaniegibson8043]

Thank you for this! My question is, it seems you have more than this one property, but only showing this one in QB for this demo. Does that mean you have each of your properties under different LLC's and all of the LLC's are listed separately in QB?

[@Incomedigs]

Hi Stephanie...thanks for watching! I do not necessarily have each property under a different LLC. I do have SOME properties under different LLCs...but not necessarily a 1 to 1 ratio. But to answer your question: Yes, I have several LLCs separated out into 1 QBO subscription. I discuss this strategy in this video: kzbin.info/www/bejne/q2nQnWSHrduCfJI We also dive into the details of the strategy in our end to end course: www.incomedigs.com/reab2

[@nam-neungchannel8027]

should we put the GST on this sale?

[@Incomedigs]

Yes...you could certainly include GST in the sale journal entry.