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A rent ledger is a detailed record of rents received or paid. It is used for record keeping to track rents and have documentation in the event a matter needs to go to court. Rental management software that includes these ledgers, along with other options, is available to help landlords and property managers stay organized. Hard copies can also be kept, especially for landlords who only own one or two properties and don’t generate a great deal of records. Tenants may keep their own ledgers for personal reference.
Each line in the ledger provides space to record pertinent information about a payment. This typically includes the name of the tenant and address, along with the amount paid and the date. The type of payment, such as cash or a check, can also be noted, along with details like the check number. A notations line may provide room to add an extra comment if the tenant paid late or there were other problems with the payment.
When landlords receive rents, they can record them in the ledger and provide a receipt for the tenant, which provides protection for both parties. The receipt can be used by the tenant to prove that rent was paid, while landlords can disprove claims that tenants were double charged with the use of the ledger and receipt records. In addition, a rent ledger can be used at tax time to account for income earned from rents.
It can be to the advantage of a tenant to also maintain records of rent paid. For businesses, this documentation, along with receipts, is necessary to claim deductions on taxes. In private homes, the ledger can provide records to use if there is a dispute about the rent later. Tenants can ask to compare their records with those of the landlord to make sure they match, and address any disparities like incorrectly entered payments.
One advantage to rental management or accounting software is that it can provide some functions automatically. It may save data so the user doesn’t have to enter it repeatedly, and can calculate late fees, if necessary. The software can also generate flags for late rents so the landlord can keep track of who owes money; it also can be used to print reports for specific properties. These can show how much money was earned over time, whether the property is paying for itself, and if the tenant has remained in good standing.