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Do you need to start tracking your numbers or move from a spreadsheet to real accounting software? Here’s a look at the most popular small business accounting software options for small and very small businesses.

Common Small Business Accounting Software Providers

QuickBooks

QuickBooks is one of those programs that everyone uses because everyone uses it. It has one of the most robust sets of built-in features, add-on apps, and integrations with banks and other services. It’s also widely criticized for being slow, overly complicated, and lacking strong customer support. Basically, it’s about what you’d expect from any large business software provider.

The software comes in two core versions — desktop and online. Each core has additional tiers depending on how complex your needs are. As usual, the Mac desktop software is significantly more limited than the Windows software. Mac users may want to lean towards the online versions for this reason.

All users may also want to use the online versions because they allow you to collaborate with others in your business in real time including those working remotely. The online version also gives your accountant 24/7 access.

In summary, QuickBooks is a good, safe choice if you want to follow the crowd.

Wave

Wave was the first mainstream online-only accounting and bookkeeping software. It’s developed a steady core of users, although it isn’t anywhere near as large as QuickBooks.

The main differentiator is that Wave provides free bookkeeping software for small businesses. Wave makes money by offering payment processing, payroll services, and other business services as add-ons. However, they aren’t pushy about it, and you can easily only use the free services.

Wave also trades features for a simpler, more streamlined process. If you run a service-based business or simple retail operation, it will probably meet your needs. If not, you’ll probably need QuickBooks.

Xero and Zoho

I put Xero and Zoho together because they’re probably the next two largest providers, but I haven’t really used them. I took them for a spin and wasn’t impressed.

In my opinion, they’re not any easier to use than QuickBooks but don’t have as many features. They’re also paid subscriptions, so they don’t have the free factor that Waze does.

I’d still say take a look to decide for yourself.

QuickBooks Self-Employed

QuickBooks Self-Employed is a basic version of QuickBooks designed for Schedule C filers with simple accounting needs. It allows you to track income, categorize expenses, and save receipts.

It also tracks your business mileage either by manual entry or by automatic tracking via an app. However, if you decide to use automatic mileage tracking, you’ll want to keep an eye on it. Performance varies by phone, and the app may miss shorter trips.

Other features include basic invoicing, a draft Schedule C that you can view throughout the year, estimated tax payment calculations, and exporting to your tax software.

What this version does not have is detailed invoice tracking, the ability to create financial reports, or the ability to classify and track different sources of income.

Personal Finance Software vs. Small Business Accounting Software

Many brand new sole proprietors ask about using personal finance software to track business income and expenses. This comes out of a desire to save money or to keep everything in one place.

If you have a straightforward side job with minimal expenses, you might be able to pull it off by adding categories for your business transactions. However, I’d strongly recommend looking into something like QuickBooks Self-Employed instead.

Is Small Business Accounting Software Enough or Do You Need an Accountant?

Accounting isn’t magic, and everyone can do it if you’re willing to learn. However, small business accounting software isn’t magic either. If you don’t have the underlying accounting knowledge, you may be misclassifying things for tax purposes or making other common bookkeeping errors. An accountant can also suggest proactive steps to reduce your taxes or increase your profits that you may not be aware of.

In short, if you don’t have a strong accounting background along with the time and desire to really understand how your accounting software works, you probably still want to work with a small business accountant.

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