A property management chart of accounts has a harder job than a normal small-business chart. It has to keep your company’s own income and expenses in one place, keep every dollar you hold for owners and tenants in another, and still produce an owner statement that ties to the bank. This post gives you a sample chart you can copy, split into an operating side and a trust side, and shows how the trust accounts flow into the owner statement.
The account numbers and names are a starting template. Your software, management agreements, and state trust rules will shape the final version.
Why property managers need two structures: operating and trust
Most property management companies run two sets of books, and the chart of accounts should match.
- Operating books belong to your company. Income is the fees you earn. Expenses are payroll, software, insurance, and rent. Your own tax return is built from this ledger.
- Trust books hold money that belongs to other people: rent collected for owners, owner reserves, tenant security deposits, and prepaid rent. In a well-built trust ledger, the cash in the bank always equals what you owe everyone, owner by owner and tenant by tenant, plus any small broker balance your state permits.
Regulators look closely at this split. California’s Department of Real Estate lists commingling trust funds with business or personal funds among its most common enforcement violations, along with failing to keep separate records for each beneficiary. Rules vary by state, but the accounting principle is the same everywhere: one chart for your business, one for the money you hold.
If you want the bigger picture of how these two ledgers interact month to month, start with our property management accounting guide.
Sample property management accounting chart of accounts: operating company
This is the chart for the management company itself. Number ranges follow the common convention (1000s assets, 2000s liabilities, 3000s equity, 4000s income, 5000s and 6000s expenses), which most accounting software expects.
| No. | Account | Type | Notes |
|---|---|---|---|
| 1000 | Operating checking | Asset | Company money only |
| 1010 | Payroll checking | Asset | Optional, if you run payroll from a separate account |
| 1100 | Management fees receivable | Asset | Fees earned but not yet transferred from trust |
| 1150 | Advances to owners | Asset | Company money fronted for an owner’s property; track by owner |
| 1200 | Prepaid expenses | Asset | Insurance, software paid annually |
| 1500 | Furniture and equipment | Asset | |
| 1510 | Vehicles | Asset | |
| 1590 | Accumulated depreciation | Contra asset | |
| 2000 | Accounts payable | Liability | Company bills, never owner bills |
| 2100 | Credit cards | Liability | |
| 2200 | Accrued payroll and payroll taxes | Liability | |
| 2400 | Line of credit | Liability | |
| 3000 | Owner or member capital | Equity | |
| 3100 | Owner or member distributions | Equity | |
| 3900 | Retained earnings | Equity | |
| 4000 | Management fees | Income | Your main revenue line |
| 4100 | Leasing and tenant placement fees | Income | |
| 4200 | Lease renewal fees | Income | |
| 4300 | Maintenance coordination fees and markups | Income | Only as your agreement allows |
| 4400 | Owner onboarding and setup fees | Income | |
| 4500 | Late fees retained | Income | Only if the agreement gives late fees to the manager |
| 4600 | Application and inspection fees | Income | Check your state’s rules on application fees |
| 5000 | Maintenance staff wages | Cost of services | If you employ in-house techs |
| 5100 | Maintenance supplies not billed to owners | Cost of services | |
| 6000 | Salaries and wages | Expense | Office and management staff |
| 6010 | Payroll taxes and benefits | Expense | |
| 6100 | Property management software | Expense | |
| 6150 | Bank and payment processing fees | Expense | Fees on company accounts |
| 6200 | Insurance (E&O, general liability) | Expense | |
| 6300 | Advertising and marketing | Expense | Marketing for your company, not owner vacancy ads |
| 6400 | Licenses, dues, and education | Expense | |
| 6500 | Office rent and utilities | Expense | |
| 6600 | Vehicle expenses | Expense | |
| 6700 | Professional fees | Expense | Accounting, legal |
| 6900 | Depreciation | Expense |
Two accounts here do a lot of work. Management fees receivable lets you record fees in the month you earn them even if the transfer from trust happens on the 5th. Advances to owners keeps track of any company money you put into an owner’s property, so you know who owes you and the trust side never shows a negative owner balance hidden by operating cash.
Trust chart of accounts: cash, owner ledger accounts, and tenant liabilities
The trust side looks different. It has almost no equity, because none of the money is yours. Its balance sheet is cash on one side and amounts owed to owners and tenants on the other.
| No. | Account | Type | Sub-ledger |
|---|---|---|---|
| 1000 | Trust checking (rents) | Asset | |
| 1010 | Security deposit trust account | Asset | Separate account if your state or practice requires it |
| 1100 | Deposits in transit | Asset | Receipts not yet cleared |
| 2000 | Owner funds held | Liability | By owner and property |
| 2100 | Owner reserves held | Liability | By owner |
| 2200 | Tenant security deposits held | Liability | By tenant |
| 2300 | Prepaid rent | Liability | By tenant |
| 2400 | Vendor payables for owner properties | Liability | By vendor and property |
| 2500 | Management fees due to operating | Liability | Clears when the fee is transferred |
| 3000 | Broker funds | Equity | Only if your state allows a small amount for bank fees |
Under owner funds held sit the owner ledger accounts: the property-level income and expense accounts that drive each owner’s statement.
| No. | Owner ledger account | Effect on owner balance |
|---|---|---|
| 4000 | Rent income | Increases |
| 4100 | Late fees (owner share) | Increases |
| 4200 | Other tenant charges (utilities, pet fees) | Increases |
| 5000 | Repairs and maintenance | Decreases |
| 5100 | Utilities paid for the property | Decreases |
| 5200 | Management fees | Decreases |
| 5300 | Leasing fees | Decreases |
| 5400 | Insurance, property tax, HOA dues | Decreases |
| 5500 | Mortgage payments made for the owner | Decreases |
| 2010 | Owner contributions | Increases |
| 2020 | Owner distributions | Decreases |
Property management software typically tags these accounts by property and owner and rolls their net balance into owner funds held. The trust balance sheet stays simple while each owner still gets a detailed report.
Notice that management fees appear on both sides. On the trust side, the fee is an expense to the owner (5200). On the operating side, the same dollars are your income (4000). The transfer from trust to operating is what connects them.
How the chart maps to owner statements
An owner statement is a report on one owner’s slice of the trust ledger. If the chart is built right, the statement adds up without manual tweaks. Here is one month for a single-family rental, with an 8% management fee and a $1,500 reserve the owner wants held:
| Line | Account | Amount |
|---|---|---|
| Beginning balance | 2000/2100 | $1,500.00 |
| Rent received | 4000 | $3,200.00 |
| Late fee (owner share) | 4100 | $50.00 |
| Plumbing repair | 5000 | ($425.00) |
| Management fee (8% of rent) | 5200 | ($256.00) |
| Owner distribution | 2020 | ($2,569.00) |
| Ending balance | 2000/2100 | $1,500.00 |
The ending balance is what you still hold for this owner. Add up every owner’s ending balance (including reserves), plus tenant security deposits held, prepaid rent, unpaid vendor bills for owner properties, fees due to operating, and any broker funds, and you should get the adjusted trust bank balance. If deposits sit in a separate account, reconcile that account against deposits held on its own. That comparison is the core of the three-way reconciliation covered in our guide to real estate trust accounting.
Two things this owner’s statement does not show: the tenant’s security deposit and any prepaid rent. Both are tenant money held in trust, so they sit in 2200 and 2300 rather than in the owner’s balance. Many companies list them in a memo section so the owner can see them.
At year end, the rent the manager paid over to each owner is typically reported on Form 1099-MISC. Current IRS instructions say a real estate agent or property manager uses Form 1099-MISC to report rent paid over to the property owner. A clean rent income account by owner makes that easy. Your CPA should confirm the filing details for your situation.
Common property management chart of accounts mistakes
- Booking gross rents as company income. Rent collected for owners is a trust liability. Only the fee you keep is income.
- One combined chart for operating and trust. Even if your software allows it, it makes commingling easy and reconciliation hard.
- An account for every owner or property. Use sub-ledgers or property tags instead. A chart with 400 “Rent: 12 Main St” accounts is impossible to report on.
- Security deposits recorded as income or left in operating. They are tenant money until applied or returned. Some states set strict rules on where deposits are held; Massachusetts, for example, has detailed requirements covered in our Massachusetts security deposit law guide.
- No prepaid rent account. When a tenant pays next month’s rent early, it should not hit the owner’s statement until it is due.
- Negative owner balances covered by other owners’ money. If an owner’s ledger goes negative, the shortfall is being paid by someone else’s funds. Record a company advance or collect from the owner. The California DRE lists trust fund shortages among the problems it sees.
- Fees left in trust indefinitely. Earned fees sitting in the trust account turn into commingling. Transfer on a set schedule and use 2500 to track what is due.
How to migrate an existing property management chart of accounts
If you are cleaning up a chart that grew without a plan, migrate in steps rather than starting over mid-year.
- Export the current chart and a trial balance. Note every account with activity in the last 12 months.
- Map old accounts to the template. Build a simple two-column list: old account, new account. Many old accounts will merge.
- Separate trust from operating. Any owner or tenant money sitting in operating accounts needs a plan to move it, documented line by line.
- Set up sub-ledgers. Owners, properties, and tenants become tags or ledgers, not chart accounts.
- Pick a clean cutover date. The first day of a month, ideally a quarter or the start of the year, so comparisons stay readable.
- Bring in opening balances by owner and tenant. Owner balances, deposits held, and prepaid rent must each tie to a list you can defend.
- Reconcile the first month in full. Run a three-way reconciliation before you close the first period on the new chart.
- Make old accounts inactive, not deleted. Your history stays intact for your CPA.
The property management accounting guide walks through the monthly close that should run on top of the new chart.
When to bring in property management accounting services
If you have years of history, owner balances that don’t tie, or deposits never tracked by tenant, and you would rather have specialists set up the operating and trust sides and keep them reconciled every month, see our property management accounting services. For trust-side work such as three-way reconciliations and deposit tracking, there is also our trust accounting service. Susan Volpe, our founder, reviews every client’s books, and for tax preparation and planning we work with trusted CPA partners, or with your own CPA.
Sources
- DRE Highlights Most Common Enforcement Violations to Strengthen Consumer Protections and Licensee Practices, California Department of Real Estate. Accessed October 20, 2026.
- Instructions for Forms 1099-MISC and 1099-NEC, Internal Revenue Service. Accessed October 20, 2026.
This article is general information, not tax or legal advice. Talk with your CPA or attorney about your situation.
