Do You Know What Your Net Income From Real Estate Photography Is?

December 29th, 2014

NetIncomeSteve Vandel recently sent me the following:

A week of so back, you had posted a poll on income for RE photographers.  It made me realize, that while I have a decent grip on my gross income, I did not have the same for my net income.  I have decided that next year I will be more organized and track my expenses on a monthly basis, something I usually wait for tax time to do.  I’ve updated a p&l spreadsheet that tracks income from multiple sources and has several expense categories relevant to RE photography.  I am happy to share with anyone that might find it useful. The excel file is here in my dropbox.

Steve is right on. It’s super important to understand what your expenses are on a month-to-month basis. As Steve suggests, this would be a great new year’s resolution. to track your gross vs net income monthly.

Thanks Steve for sharing your expense tracking spreadsheet!

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12 Responses to “Do You Know What Your Net Income From Real Estate Photography Is?”

  • As usual Larry, your on it. Been spending a lot of my day researching what bookkeeping software to use since my business is making the jump to LLC in 2015.

    I use Mac and find Quick books awfully expensive (and don’t like to be locked in to a monthly subscription that they offer).

    Any suggestions would be appreciated.

  • I have been doing this for many years. You’re flying your business blind if you cant run these types of reports on what is going on with your money. “Success is not soley about making money, but knowing where the money you’re making is going.”
    I have been using Kashoo.com for about 5 years now. I can run balance sheets and p&l’s at any time and compare to the past. My tax man loves me come tax time! I also use Freshbooks.com for all of my invoicing and day to day expenses. Both are SaS and talk to one anoyher via an API. Everything is synchronized. I have made up the cost of both of these not only in my time, but in late fees I have collected from the invoicing systems late fee automation. I take CC payments via stripe and that is also tied into freshbooks for seamless payments. I never touch a clients CC (why I dont use square). It also makes me look professional and on top of things.

  • I have been using QB for around 20 years and would recommend it highly. Set it up right and at the end of the year, your tax work is simple. I would Highly recommend getting a accountant that you can work with, have them set up your book keeping software and just send over the account file once a quarter. The few bucks you spend there will be well worth the peace of mind at the end of each year.

    My accountant keeps me aware of my tax situation throughout the year, letting me know that I should buy new equipment, auto, retirement savings, etc. to right off or differ income tax until I retire (fat chance), but the point is that I get to buy a bunch of toys that go toward lowering my gross so that I get the benefit, not some flaming liberal who wants to spend my taxes on wind mills.

  • Freshbooks is very good for invoicing and tracking all expenses, tons of reports and features, one feature allows you to set up Automatic Late Payment Notifications at whatever intervals you want.

    They also recently added their own credit card processing system, so you dont have to use an outside addon like paypal, stripe etc, customers pay right through the the freshbooks invoice….everything in 1 place The cost is the same as Paypal (2.9% plus $0.30), you can also enter a customers credit card payment manually if you need to for that same fee…unlike Square and paypal that charges additional fees for entering manual payments.

    The great thing with their payment system is that is automatically enters the fees details into your expense area.

    For the ease of use and the amount of time it saves you its well worth the money.

  • waveapps.com

    Stripe payments for invoices
    Mobile payments
    Mobile invoicing
    Mobile receipt scanner
    As long as you are categorizing correctly, it also automatically creates financials – income statement and balance sheet.

  • Since ’92 I’ve been using Quicken for personal and business, currently using Quicken Home & Business. I’ve used Quicken to run 3 businesses and Quickbooks for a 4th. For my consultancy, photography, and real estate investment business, we used Quicken. My wife used Quickbooks for her real estate brokerage.

    QB is good, but for most I think it’s an over built pain. There’s a certain threshold where I would recommend it, but for most, I believe Quicken will do everything you need, including Invoicing, Receivables, Payables, and the like.

    Similar to Chad, my accountant loves me. I keep up on all my paperwork (why pay his team $$/hr to do it) current. The categories are designed to map directly to my Schedule C. So whenever I want, with the latest receipts entered, I can tell you where I’m at to the penny. When I sit with my accountant, I typically have already generated all the reports/info he wants. Any I’ve forgotten, I create on-the-spot for him and send him the PDFs. Works exceptionally well.

    It can be daunting to set up from scratch if you’ve never done this before. If you’re simply using Excel (better than nothing), you really should consider something like Quicken or one of the other tools. They offer -so- much more, for the same amount of effort (e.g. inputting data), its hard to imagine. If only for automating bank account downloads and reconciliation, let alone helping automate payments, the time saving pays for itself the first month or two.

  • Great advice all, thanks.

  • Good discussion. Spent some time today looking at Freshbooks and Wave. I’d be willing to switch to one of them for the increased functionality over Square (Wave looks better IMO), but both of them have higher transaction fees than Square – 2.75%. I currently use Excel for tracking expenses, which are fairly simple and not that many, so for me, it’s not worth it (for now anyway).

  • Simple answer, no. This is my first full year in business and I’ve spent lots of money upgrading equipment that’s needed to make my work move faster and smoother. All I know is there is money left over and I’ll start on my taxes next week. 2015 will be more profitable.

  • I use Quick Books Online for my brokerage. It is very good and easy to use. One of the big benefits of the online version is that it links directly to your bank accounts and credit cards. You just match invoices with payments and bills to withdrawals. Credit card transactions are classified by expense type if it is recognized and can be manually entered for easy expense tracking. It can also do payroll and taxes etc. They offer a free trial. I upgraded to the Plus version for tracking by class of properties which might be overkill for real estate photography but is great for breaking down income and expenses by property (shows me which agents are producing etc.)

  • I use Quickbooks. It allows me to download info directly from my business checking account directly to QB. It also allows me to send my invoices via email with a link to pay via Paypal. With just a few clicks I can view my expenses for the year or the month and compare this year to last year. As they say… “Its all about that net, bout that net, bout that net”… sorry I could not resist. 🙂

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