Property Developer & Construction Bookkeeping and Tax

Every project should carry its own numbers: materials, labor, subcontractors and equipment. When costs land in general expense accounts, there's no way to tell which jobs made money and which ones didn't.

Permits, equipment time, fuel, small tools, dump fees and supervision are easy to leave off a job. Recording every direct and indirect cost of a project is what turns the next bid from a guess into a number you can stand behind.

Billing ahead of or behind the work distorts profit from month to month. A work-in-progress schedule shows where each job really stands, which is exactly what bonding companies and lenders look for.

Retainage on both sides, approved and pending change orders, and progress billings are tracked by job, so nothing slips through and cash flow stays predictable.

1099s for subcontractors, license and insurance checks, workers' comp class codes and certified payroll on prevailing wage jobs. California applies its own tests to subcontractor relationships.

For developers, land, permits, soft costs and construction loan interest are generally added to the cost of the project rather than expensed, and each project often sits in its own entity. Loan draws, investor contributions, the accounting method for long-term contracts and equipment purchases are planned with taxes in mind.