FAQ > Managing Tenant and Lease Agreement Information

How do I track security deposits?

In SimplifyEm.com Property Management Software, to track security deposits, enter the security deposit amount due when setting up the lease for the tenant (or edit your already setup lease terms); this amount will then appear in the rent roll report and tenant payment history report as the security deposit due. You will then show the security deposit collected on the property worksheet in the tenant row and allocate towards security deposit due.

NOTE: If a tenant moves out and you have kept any portion of the security deposit, the IRS requires you to report it as Income. When the tenant moves out, SimplifyEm.com Property Management Software will ask you how much of the deposit amount you returned or if you returned all of it. Based on this, SimplifyEm.com Property Management Software will automatically record the remaining amount as “Rental Income” on your worksheet. Also, if you used any portion of the deposit amount for any expense on the unit, don’t forget to manually enter it on the worksheet!

 

Note: Remember to manually record expense transaction(s) on the worksheet, if there were balancing expenses for what the security deposit was used for.