Escrow HELP- Am i recording interest paid to Escrow and fees paid from Escrow correct
(Staten Island, NY)
I am not accountant, took on the job as a treasurer in my church. Using Aplos to keep me sane.
Escrow. It is setup as an Asset.
When we pay the mortgage, we divide the payment into the principal (liability), interest (expense) and the escrow (asset it is a register Asset account).
a) When the bank pays the property taxes and the property insurance from the Escrow Account. I will use the register and treat it like a check. Record from the Escrow Assets account, property taxes (expense) and property insurance (expense).
b) The account also receives interest and it has a fee. I am guessing that I will do the same as with the property taxes.
In the Asset account(register), record escrow interest paid (income account). The same logic for the fee. From the Asset Account, record Escrow_Disbursement_Fee (expense)
Is this correct?
Also Should I call the property Tax and Property Insurance that is paid by escrow prepaid property tax?