The holidays are almost here, and so is the finish line for your rental property's year. Before the twinkle lights go up and the pie comes out, a little year-end housekeeping can save you money, stress, and a frantic January.
Whether you self-manage or work with a professional property manager, this checklist covers what to tackle in November and December. Grab a cup of cocoa and start checking boxes. If you have a manager, many items are a quick confirmation rather than a to-do.
Property Taxes
In California, the first installment of your secured property tax bill is due November 1 and becomes delinquent after December 10. Miss it and a 10% penalty applies.
- Confirm you received this year's tax bill for every property (and any supplemental bills from a recent purchase or improvement)
- Pay the first installment before December 10
- Decide whether to also pay the second installment (due February 1, delinquent after April 10) before December 31; talk to your CPA about whether prepaying helps this year's return
- Review your assessed value; if it looks high, check your county's appeal deadline (many California counties close their filing window November 30)
- If your mortgage lender pays taxes through escrow, verify the payment actually went out
- Managed properties: confirm with your Property Supervisor whether Babcock pays the taxes or you do, and get confirmation of the payment on your monthly report
Income & Expenses
Clean books by December 31 make tax season fast and cheap. Every legitimate expense you can document is one you can deduct.
- Reconcile rent received against your rent roll for all 12 months; note any unpaid or partial rent
- Account for security deposits separately; they are not income unless applied to rent or damages
- Gather receipts for repairs, supplies, utilities, insurance, HOA dues, advertising, legal fees, and mileage
- Separate repairs from capital improvements (a new roof or appliance is usually depreciated, not deducted all at once)
- Make sure no personal expenses slipped into the rental account, and vice versa
- Consider timing: if a needed repair is planned anyway, doing it before year-end may move the deduction into this year
- Managed properties: review your monthly report and confirm the year-to-date totals match your bank deposits; set up a call with your Property Supervisor to discuss projected expenses between now and end of year
1099s
Big change this year: for payments made in 2026, the 1099-NEC and most 1099-MISC reporting thresholds rose from $600 to $2,000 per recipient. Forms for 2026 are due to contractors by February 1, 2027 (IRS-based summary, NEC deadline).
- List every vendor you paid this year (handymen, plumbers, landscapers, cleaners, attorneys) and total each one
- Flag anyone you paid $2,000 or more for services; they likely need a 1099-NEC
- Collect a W-9 from each flagged vendor now, not in late January
- Note who you paid by credit card or apps like PayPal; those payments are generally reported by the payment company, not you
- Don't skip attorneys: legal fees are usually reportable even if the firm is a corporation
- Managed properties: Babcock issues 1099s for vendors we paid on your behalf, and expect a 1099-MISC from us for the rents we've collected for you
Reports to Your CPA
A tidy package in early January gets you to the front of your CPA's line, before the spring rush.
- Book your tax appointment now; good CPAs fill up fast
- Ask your CPA before December 31 whether any year-end moves make sense (prepaying expenses, timing repairs, buying equipment)
- Prepare a year-end package for each property: income and expense summary, rent roll, mortgage interest (Form 1098), property tax receipts, insurance declarations, and closing statements for any purchase or sale
- Include a list of improvements made this year with dates and costs, for depreciation
- Note any changes: new properties, refinances, vacancies, or a change in ownership or entity (like moving a property into an LLC)
- Managed properties: provide your December report to your CPA and direct them to the YTD column along with your 1099 (usually ready by late January)
Weatherproofing
Even in mild Southern California, the first big rain is when small problems turn into expensive ones. A few hours of prevention now beats an emergency call on a holiday weekend.
- Clean gutters and downspouts, and make sure water drains away from the foundation
- Inspect the roof for missing shingles, cracked tiles, and worn flashing
- Check windows and doors for gaps; replace weatherstripping and caulking where needed
- Service the heating system and replace HVAC filters
- Test smoke and carbon monoxide detectors and replace batteries
- Trim trees and branches away from roofs and power lines
- Insulate exposed pipes at properties in mountain or desert areas where freezes happen
- Clear yard drains and check slopes for erosion
- Remind tenants how to report leaks quickly, and share your after-hours contact
- Managed properties: ask your manager for their fall inspection results and any recommended repairs
Planning for Next Year
The best gift you can give your future self is a plan. Set aside a bit of time now to set up a smoother 2027.
- Set a budget for each property: expected rent, operating costs, and a reserve for repairs
- List upcoming lease expirations and decide on renewals and rent adjustments (follow local rent-control and notice rules)
- Schedule big-ticket projects (roof, paint, appliances) and get bids early
- Review insurance coverage and limits before renewal, and confirm tenants carry renters insurance if your lease requires it
- Check that your entity setup (LLC, trust) still fits your goals; ask your attorney or CPA
- Set up a simple system for 2027 records: a separate bank account, a receipts folder, and a W-9 on file before paying any new vendor
- Self-managing and feeling stretched? Year-end is a natural time to interview professional property managers
- Managed properties: schedule a year-end review with your Property Supervisor to discuss performance, rents, and goals
Cheers to a Great Year
Check these boxes over the next eight weeks and you'll ring in the new year organized, protected, and ready for tax season. Happy holidays from our team to yours!
This article is general information, not tax or legal advice. Tax rules change, so confirm details with your CPA or attorney.
Sources: NATP: Form 1099 changes under the new $2,000 threshold · 1099-NEC 2026 rules and deadline