Importing your data
Getting up to speed involves connecting the app to your bank accounts from a list of the leading U.S. and Canadian banks. You can choose to have the application automatically import your transactions for the past 90 days; to add transactions from further back, you have to download and import a .CSV file. You can also, if you wish, manually input your transactions.
QuickBooks Self-Employed helps contractors set up their financial transactions to make things easier at tax time by aligning each transaction with an IRS-approved expense or income category as closely as it can, given the support data users feed it. For example, its transaction list is displayed in a way that makes it easy to split business expenses from personal spending within a single bank account. The software does a good job of anticipating what IRS expense category a transaction belongs under; it gave me two ways to split a transaction -- by amount or percentage.
More for your mileage
One expense that contractors and freelancers sometimes overlook is the amount of miles they rack up for their business. QuickBooks makes it hard to ignore this, with a section and a downloadable mobile smartphone app that tracks trips and mileage.
I input standard vehicle information into the Web interface and downloaded the Apple version for my iPhone. Once it is set up, 54 cents per mile clocks into your tax-deduction side without your having to think about it. You can also designate whether it's personal or business mileage.
No surprises at tax time
Paying quarterly (and annual) taxes can be painful if you wait until just before the due date to calculate them. QuickBooks Self-Employed is all about making sure you know how much you owe, and when they are due.
There is a floating banner on the Home dashboard warning you of the deadline and giving you the number of days you have to get everything together. And if you miss that, your amount owed is shown at the top of your dash. Provided you have input all transactions and their categorization is accurate, the estimated tax figure QuickBooks gives you should be accurate. You can even choose to have them paid via the application (assuming you've upgraded and have TurboTax as well).
QuickBooks Self-Employed is a capable SaaS solution when it comes to processing and understanding a freelancer's income/expense landscape and tax liability picture from financial institution accounts. While it's not a tax preparation application, it does integrate with Intuit's TurboTax, which makes it even simpler to calculate, prepare and pay.
It's also not a complete solution for independent contractors because it's not able to track hours, generate invoices or provide reports on receivables. That said, its reasonable pricing allows for room to add a solution that does.
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