Repairs Archives

FLIPS and Rehabs, Question from Randy

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

ANSWER from Mike

I enter the expenses of the rehab "Improvements"

- NO, NO, NO - when you buy any property, everything and anything you do to or on this property...

You are unauthorized to view this page.

QuickBooks For Real Estate – Repairs vs. Capitalized

QUESTION: 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   ANSWER: Great Question Steve! This is probably one of those questions most investors are afraid to ask. For starters, as an investor and business owner

You are unauthorized to view this page.