Sometimes you may notice that a late fee has posted for a resident, but according to their ledger, the resident has a $0 balance.
If the software adds a late fee when the ledger "by date" has a running total of $0, then it usually means that a charge or payment has been allocated to the wrong type of general ledger account.
It's also possible that a backdated transaction has been added after the late fee posted. If the instructions below are not applicable, check the audit log for backdated transactions. An example of this would be if a late fee posted on Monday, but a payment was added on Tuesday and backdated to Monday.
Troubleshooting late fees on ledgers with no balance
In the picture below, we see Jane's lease ledger By date. A late fee has posted on July 7th, even though the July 1st payment left the total outstanding balance at $0.
In the picture below, we see Jane's late fee policy. It is set up so that a late fee posts when there is a charge on any outstanding balances.
Armed with this information, let's look at Jane's ledger By account. This view shows all of the same information as the first picture in the article, it simply organizes it based on how each charge and payment are allocated.
With the By account view, you can see that though the total balance on the By date page was $0, that there is a credit balance for prepaid rent liability and an outstanding balance in the same amount for rent income. This outstanding balance began after the July 1st payment was received, which means part of the payment was mis-allocated to the wrong account type.
Because money is owed for Rent Income, and there is no charge for prepaid rent liability, the system posted a late fee, as late fees are based on account type, not overall balance.
Remember that the ledger defaults to the last three months of activity. If everything looks fine when you first open the ledger, change the date range from Last 3 months to All transactions and try again.
To fix this issue, there are a few options:
Review the other balances "by account." If something was allocated incorrectly, fix it.
In Jane's ledger, the July 1st payment was allocated to Prepaid Rent Liability. Considering that there is an $1,000 outstanding balance for Rent Income beginning in September and a $1,000 credit balance for Prepaid Rent Liability, it's reasonable to assume that the Prepaid Rent Liability payment may be incorrect.
Edit the payment to correct the allocation.
Editing the payment may affect the property's available cash balance and 1099 calculations. If the transaction is from last year, check with your accountant to see if it's ok to make the change.
If the July 1st payment was correctly allocated to Prepaid Rent Liability, then it's possible that the September charge was mis-allocated.
Edit the charge to correct the allocation.