Most likely you financed it somehow and so you need an offsetting debt account. Did you pay cash for it? Well then there should be a transaction in your cash accounts that shows that. You can’t just create an asset out of thin air and put it on your books, it had to come from somewhere. Create your liability accountīookkeeping is like Newton’s Third Law of Motion, except instead of “for every action” think of it as “for every asset created, there is an equal and opposite transaction or set of transactions to offset it”. This one step will actually create three separate accounts, all the “Fixed Asset” accounts needed so you do not actually have to manually create the “Original Cost” and “Depreciation” accounts associated with a property. The screen shot on the right is what the asset account setup looks like. I usually use the Category Type of “Fixed Asset” and the Detail Type of “Other Fixed Assets” for rental properties for no other reason than that the other options don’t seem to apply well to houses. Set up rental property asset account in Quickbooks Online
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