One LLC per property: how to keep separate books and bank accounts

How the IRS treats a single-member LLC

The IRS page on single-member limited liability companies says an LLC with one member is treated as an entity disregarded as separate from its owner for income tax, unless it files Form 8832 and elects to be taxed as a corporation. Its activities are reported on the owner's return, and for a rental that is generally Schedule E.

Two practical results follow. First, five buildings in five single-member LLCs usually means five columns on your Schedule E, not five tax returns. Second, the same page says a disregarded LLC uses its owner's Social Security number or EIN for income tax reporting, but needs its own EIN if it has employees or owes certain excise taxes. A bank may also ask for an EIN to open an account in the LLC's name.

An LLC with two or more members is a different case: it is usually taxed as a partnership and files its own return. Ask your tax preparer which applies to each of yours.

Why separate books still matter

• Each property gets its own Schedule E column. If the money is mixed, someone has to split it by hand at year end.
• Lenders want one building's numbers. Refinancing asks for a property's profit and loss and rent roll, not a blend.
• Selling is cleaner. A buyer's due diligence asks for two or three years of one building's income and expenses.
• Problems stay visible. A building losing money is easy to miss when its bills are paid from a neighbor's rent.
• The LLC is treated as its own business. Whether a court respects an LLC's separateness is state law; ask your attorney how your state looks at an LLC whose money is mixed with its owner's or with another LLC's.

Setting it up, step by step

1. Form the LLC and get its EIN from the IRS.
2. Put the property's deed and loan in the LLC's name, with your attorney and lender.
3. Open an operating account in the LLC's name. Add a deposit account if your state requires deposits to be held apart, or if you prefer it.
4. Point every tenant's rent at that LLC's account, and move every bill for that building to it: utilities, insurance, taxes, vendors.
5. Open a separate set of books for the LLC, with its own chart of accounts.
6. Record your starting money as an owner contribution, and every later transfer to you as a distribution.

For the accounts themselves, see a simple chart of accounts for an apartment building.

When one LLC has to help another

It happens: one building has a $14,000 boiler failure in a month when its account holds $6,000. The clean way is never to pay the bill from the other building's account. Move money through yourself, or record a loan between the LLCs, and write it down the same day.

Example a made-up owner has Elm Street LLC with $6,000 in the bank and Oak Avenue LLC with $40,000. Elm needs $14,000 for a boiler. Option one: Oak distributes $8,000 to the owner (Oak books an owner distribution of $8,000), and the owner contributes $8,000 to Elm (Elm books an owner contribution of $8,000). Elm pays the boiler from its own account, which now holds $14,000. Option two: Oak lends Elm $8,000 under a short written note; Oak books a loan receivable of $8,000 and Elm books a loan payable of $8,000, repaid from Elm's rent over the next months. Either way, the boiler lives only in Elm's books.

The thing to avoid is the third option: Oak pays the boiler company directly. Now Oak's books show an expense for a building it does not own, and Elm's books are missing a $14,000 asset.

Shared costs across several LLCs

Some costs cover more than one building: one umbrella insurance policy, one software subscription, your mileage on a day you visit three properties. Pick a fair basis, write it down, and use it every month.

Example a made-up $1,800 yearly bookkeeping invoice covers a 24 unit, a 12 unit and a 6 unit building, 42 units in all. By unit count, the 24 unit LLC carries $1,800 times 24 divided by 42, or about $1,028.57; the 12 unit LLC $514.29; the 6 unit LLC $257.14. The three add to $1,800.

Best practice is to have each LLC pay its own share directly. If one pays the whole bill, record what the others owe it and settle up monthly.

How DoorKeeping handles it

DoorKeeping is built on one LLC per property. Each property has its own ledger, bank account, deposits held and profit and loss, and you still see every property together. Tenants pay the LLC's own bank account directly; DoorKeeping never holds rent. Anything involving money waits for your one-tap approval. It is not legal or tax advice: your attorney sets up the LLCs and your tax preparer files the return.

Sources

1. IRS, Single member limited liability companies, read Oct 29, 2026

Questions

Does each rental LLC need its own tax return?

Not usually for a single-member LLC. The IRS treats it as disregarded for income tax, so a rental's numbers generally go on the owner's Schedule E unless the LLC elects corporate treatment.

Can two LLCs share one bank account?

You can, but it makes separate books, separate Schedule E columns and a clean sale much harder. Most owners give each LLC its own account.

Does a single-member LLC need an EIN?

The IRS says it needs one if it has employees or owes certain excise taxes; otherwise it can use the owner's number for income tax. A bank may also ask for one to open an account.