When you manage your own vacation rental, the amount of paperwork can seem endless.
Digging through those folders packed with receipts, contracts, spreadsheets, and records can feel daunting–especially when tax time nears.
Tax season or not, it’s never too late to evaluate your processes for tracking your Airbnb and Vrbo business expenses and income, plus decide on ways to streamline and improve them for next year. If you’re drowning in paperwork—rest assured it can get easier. Here are some simple and quick-to-implement solutions to help you keep your books up to date without the hassle.
Keeping track of your expenses doesn’t have to be complex. Consider spending 30 minutes or so on bookkeeping every month. Or, break the work into even smaller pieces by setting aside dedicated time each day or week to update your records. Find what works for you and set up your own routine.
Stick to the same credit card for all of your business expenses, then try to pay off the balance each month. This works even if you have multiple vacation rental properties. When you review your bookkeeping, you simply have to assign the purchases to the right property and let your spreadsheet calculate your totals.
If you’re not already using a cloud-based accounting software system—such as Quickbooks Online, Mint, or Xero—consider making the move. Since the software is web-based, you can access it and record your expenses from anywhere. Link your credit card and bank account so that expenses feed right into your account, where they will be tracked and categorized automatically. Then, you’ll be able to create expense reports with just a click.
When possible, write relevant notes on the backs of your receipts so that you know exactly which expense categories they relate to. Meals and entertainment, travel, vehicle, and home office expenses are among the main choices. For instance, if you have a receipt from a business meal, write down who was present and the purpose of the meeting. This kind of paper trail is important, as it will help support your case in the event of a tax audit (credit card statements are not sufficient).
Buried under an unwieldy stack of receipts and bills? There are numerous cloud-based apps to store your paperwork as digital files instead, such as HubDoc. You can simply take photos of any paperwork with your smartphone and even forward email invoices right from your inbox. If you’re working with an accountant or a bookkeeper, this eases their workload, as they can access your bills and receipts without having to pick up a shoebox from your office.
After organizing your short-term rental expenses, you may start to see a spending pattern. You can then plan out your spending with recurring payments on sites like Amazon. If you set up purchases at the beginning of each month—such as bulk orders of paper towels and laundry detergent—you’ll know roughly how much you’re going to spend each month before the year even starts.
If you pay a contractor to do work on your vacation rental—and the cost is more than $600—you’ll owe them a 1099 at the end of the year. This is easily managed in programs like Quickbooks Online. Not only can you track how much you paid each contractor, but you can also prepare and file your 1099s from within the software.
Sure, you can go the DIY route and handle all your own bookkeeping. But hiring a professional accountant—especially one who is familiar with the laws related to the vacation rental industry and related expenses—will save you time and money. However, you’ll still need to keep good records of your expenses to make the best use of their time.
As a full-service vacation rental management company, Vacasa automatically tracks your annual earnings, supplies tax forms and owner statements, and provides end-of-year tax and expense reporting—all available in a simple online account.
Staying on top of your vacation rental expenses—then allocating and organizing them correctly—can help keep your business running like a well-oiled machine. But the pile of receipts may soon become daunting, so it’s important to use tips like these to streamline your bookkeeping (and save your sanity).
While both bookkeeping and accounting involve handling financial data, they serve separate functions.
Call 888-513-1785 to speak with a Homeowner Consultant, who can answer preliminary questions and see if we’d be a good fit for you.
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Vacasa offers property management and other real estate services directly through Vacasa LLC and through Vacasa LLC's licensed subsidiaries. Click here for more information about Vacasa's licensed real estate brokerage/property manager in your state. Vacasa’s licensed real estate brokerages/property managers include: Vacasa Alabama LLC; Vacasa Arizona LLC; Vacasa Colorado LLC (Mark Graham); Vacasa Delaware LLC, 302-541-8999; Vacasa Florida LLC; Vacasa Louisiana LLC, Dana MacCord, Principal Broker, ph 504.252.0155 (Licensed in LA); Vacasa Michigan LLC, 947-800-5979; Vacasa Missouri LLC, Susan Scanlon, Designated Broker; Vacasa Nevada LLC; Vacasa New Hampshire LLC, P.O. Box 283, Conway NH 03818, Dave Grant, Broker of Record; Vacasa New Mexico LLC, 503-345-9399; Vacasa New York LLC, 888-433-0068, Susan E. Scanlon, Real Estate Broker; Vacasa North Carolina LLC; Vacasa Pennsylvania LLC; Vacasa Real Estate Corporation, California DRE #02105811, Joseph Czapkowicz, California DRE #01380722; Vacation Palm Springs Real Estate, Inc., California DRE #01523013, Joseph Czapkowicz, California DRE #01380722; Vacasa Real Estate LLC (licensed in Colorado, Daned Kirkham); Vacasa Real Estate LLC (licensed in Idaho, Oregon, and Utah); Vacasa Real Estate LLC (licensed in Maine, Michael McNaboe, Designated Broker); Vacasa Real Estate LLC (licensed in Texas, Debra Brock, Designated Broker); Vacasa Real Estate LLC (licensed in Washington, Robert Brush, Designated Broker); Vacasa Seasonals Inc., California DRE #02160171, Lisa Renee Stevens, California DRE #01485234; Vacasa South Carolina LLC; Vacasa South Dakota LLC; Vacasa Tennessee LLC; Vacasa Vacation Rentals of Hawaii LLC, 3350 Lower Honoapiilani Road, Suite 600, Lahaina, HI 96761; Vacasa Vacation Rentals of Montana LLC, Terah M Young, Licensed Property Manager; Vacasa Virginia LLC; Vacasa Wisconsin LLC; Vacasa Wyoming LLC. In Canada, this advertisement is provided by Vacasa Canada ULC, CPBC lic. number 75826, 172 Asher Rd. V1X 3H6 Kelowna, BC.