Bank Account Structure for House Hacking

[Brett McManus]

Hi BP Community, 

Towards the end of this month I will be closing on my first duplex to House Hack in the Minneapolis, MN area. So far I  am remaining confident in my numbers/reserves amidst the current conditions and all inspections have been completed with only closing left on the agenda. 

One item that I am still interested to learn more about is how other investors/house hackers might recommend structuring bank accounts to make tax time more seamless. I already have a credit card dedicated to purchases exclusive to this property and have drafted up spreadsheets to track expenses/revenue. Is having a separate checking account dedicated to depositing rent checks/pay expenses out of the simple recommendation here for someone just getting started?  

Just hoping to see if there is any advise out there that could save headaches down the road. Thanks!

[Ryan Daigle]

Hey @Brett McManus, congratulations on this one (especially in these times!)

Yes, I would recommend having _at least_ an “operating” checking account dedicated to the income and expenses of your property. Rent goes in. Maintenance, taxes, mortgage, expenses, etc... go out.

You may also want to consider having a “capex & reserves” savings account where you shovel off your monthly reserves into. Keeps it out of the operating account so you stay disciplined in only dipping into that for actual capex-worthy expenses.

Hope that helps!