QuickBooks For Real Estate Investors
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FLIPS and Rehabs
QUESTION from Randy:
When I buy a house to rehab and flip,
I enter the expenses of the rehab,
Do I enter it as an repair expense?
I do a close out report and I am showing a Capitalized expense,
I do not know how It got there. Help Please
Randy
QUESTION from Steve:
Hello Mike,
I understand your reply of repair versus capital expense so my question must not have been clear...
When I buy a house to resell that will need some repairs, these repairs are a capital expense as the property is not in "service".
To properly see my cash flow in Investor Books PRO when I do a report, I put these fix up costs as an expense (initially). I do this under "repairs and maintenance"
The fix ups will eventually be transferred and re-characterized as a capital expense at a later date thus in the meantime allowing my cash flow report to provide useful information for me as an investor.
My question is when do I transfer this to the asset?
Thank you Mike,
Hope that is more clearer-er
Steve
QUESTION from Steve:
Hello Mike,
I looked through the Investor Books Manual and did not see this ...
When doing a flip, the repairs will be a capital expense versus an ordinary expense.
How are you booking the repairs?
Steve