With tax season approaching, we interviewed Nicholas D’Agnillo, owner of Nexus Property Management, to get some tips on how owners can prepare in advance so as not to be swamped when the filing date is bearing down fast.
“Advance preparation is so critical that we won’t officially take on new owners until they’ve given us their W-9s and contact information so we can get their tax information to them reliably when the time comes,” D’Agnillo says. “It’s a bad idea to wait until the deadline is on top of you. You should be assembling the information your accountant will need ahead of time.”
D’Agnillo says that Propertyware has capabilities built in to record and easily transmit tax-related information to owners. “The software publishes a monthly report to the owner portal in case owners need to see interim numbers, and then produces a year-end report which we send to all the owners that’s ready for them and their accountants to use,” he explains.
Other tips from D’Agnillo include:
1. Set up “pro” accounts with Home Depot and other vendors so data is collected on property-related expenditures
2. Maintain separate business accounts for each property rather than lumping them together
3. Use credit cards, debit cards or checks rather than cash to pay for property-related goods and services, making it easier to keep records
“If you don’t have software such as Propertyware that keeps up with tax-related information, I’d suggest something like QuickBooks,” D’Agnillo says. “But of course it’s not tied into the bank and there’s no integration with the rest of your software, so your rental income information won’t flow right into your monthly and year-end report – there’s more manual work to do. I’m a Propertyware fan so of course I think it’s the best way to go not just for keeping up with taxes but for running the whole business.”
Nexus Property Management provides property management and investment realty services in Rhode Island and southeastern Massachusetts.