As I had explained in my previous post for tip 1 for 9 Must-Have Tips for Running your Vacation Rental like a Business –
A vacation rental is both a fun place to stay and an investment opportunity. And a part of that responsibility is ensuring that you run your business smoothly. When you own a vacation rental, you want to have good cash flow, avoid tax penalties, stay organized, have a great presentation, minimize risk and ensure your customers are satisfied.
I want to continue to try and provide you with all the info you may need to help guide you through the jungle of beach vacation property rental pitfalls.
Establish a checking account for your VR
Separating your business into it’s own checking account helps you to properly record and report your income and expenses. It can also help you to maximize your tax advantages. You may also want to use a different bank or credit union than you use for your personal purchases. This is what I did to help prevent any commingling of personal and business funds.
Unless you setup an LLC or establish a DBA for a sole proprietorship, you will not be able to open a business account, but you don’t need to. You just need to make sure that you keep your accounts separate. At tax time, you can make tax entries easy for your accountant or for yourself with TurboTax online.
Stay tuned for our next tip!