QuickBooks Self-Employed Review: Everything You Need to Know
From QuickBooks, one of the most popular accounting software providers on the market, Intuit QuickBooks Self-Employed is designed specifically for self-employed entrepreneurs to organize their finances and stay prepared for tax time throughout the year.
This QuickBooks Self-Employed review is here to help you decide if it’s the right product for you. We’ll break down the cost, plan options, and overall features—as well as discuss top alternatives—so that you’ll have all the information you need to determine if this accounting solution will work for your business.
- Affordable pricing, often with limited-time discounts
- Integrated mileage tracking with all plans, available via desktop and mobile
- Tax tools designed specifically for freelancers, consultants, and other self-employed professionals; full-service tax tools with higher-level plans
- Easy to use with an intuitive interface; accessible regardless of location
- Limited capabilities, doesn’t offer extended bookkeeping or accounting features
- Difficult to upgrade to QuickBooks Online, and therefore, isn’t scalable
- Additional fees for certain tax filings, monthly fees can be expensive compared to competitors
Before we dive into the details of our QuickBooks Self-Employed review, let’s start with the basics.
Although this is a web-based product within the QuickBooks accounting suite, it’s best considered a tax software first and foremost—as it’s designed to allow self-employed entrepreneurs to organize their expenses, track their time, and manage their tax responsibilities.
Therefore, small business owners who are sole proprietors, LLC owners without partners, Uber drivers, Etsy sellers, realtors, freelancers, and anyone who runs some type of “side hustle”—assuming you don’t need to process actual transactions—are best-suited for this platform.
There are three different plan offerings to choose from, each with increasing tax capabilities. In addition to accessing the platform through any internet-enabled device, you can also use the QuickBooks mobile app.
Cost and Plan Options
Next, we’ll explore the different plans, features, and the cost of this self-employed accounting software.
As we mentioned, there are three plan options: Self-Employed, Self-Employed Tax Bundle, and Self-Employed Live Tax Bundle. Once again, these plans largely differ in terms of their tax capabilities, in addition to their costs.
Let’s explore further.
QuickBooks Self-Employed (Basic)
The most basic plan is called Self-Employed and costs $15 per month.
However, QuickBooks often offers limited-time discounts for their software, so you’ll want to check their site to see if they’re running any ongoing promotions. Typically, you can receive a 50% discount for your first three months.
Even with the low monthly cost of this QuickBooks plan, you’ll receive the essential features you need from a freelancer accounting software, including:
- Send and track simple invoices
- Monitor open invoices and send overdue notifications
- Invoice customers using the QuickBooks mobile app
- Enable online payments to receive payments from your invoices
- Automatically import transactions from your bank, credit cards, PayPal, etc. to separate business and personal expenses
- Automatically sort transactions into tax categories
- Take photos of receipts and link them to expenses
- Maximize Schedule C deductions by sorting transactions, tracking miles, and storing receipts
- Automatically calculate quarterly taxes, receive automatic reminders of tax due dates
- Organize income and expenses for instant tax filing
- Track miles with your phone’s GPS
- Categorize business and personal trips and add trips manually
- Invite a business accountant to access your account
- Customer support through live chat, support form, and self-service resources on QuickBooks’ website
QuickBooks Self-Employed Tax Bundle
The next plan, Self-Employed Tax Bundle, provides additional tax capabilities to even further optimize your financial processes, as well as potentially show you substantial savings in business tax returns. This version costs $25 per month.
Tax Bundle Features
As we mentioned, the main differences between the three plans relate to tax features. Therefore, the benefit of the Tax Bundle version of this software is that you’ll have a greater ability to streamline your tax processes.
In addition to all of the capabilities of the first plan, Self-Employed Tax Bundle also includes:
- Ability to pay quarterly estimated taxes online directly from QuickBooks
- Accurate estimates of quarterly taxes
- Seamless transfer to TurboTax with built-in integration
- One state and one federal tax return file included
- Export Schedule C directly into TurboTax
- E-file returns with direct deposit to receive tax refund faster
QuickBooks Self-Employed Live Tax Bundle
The last plan, Self-Employed Live Tax Bundle, costs $35 per month. However, this solution will provide the most comprehensive tax tools to help freelancers, sole proprietors, and contractors to manage their business expenses and finances.
Live Tax Bundle Features
As we mentioned, this version has the most extensive tax functionality. On top of the features of the previous two plans, Live Tax Bundle includes:
- Live, personalized-advice from TurboTax certified public accountants (CPAs) and Enrolled Agents (EAs)
- Unlimited year-round access to tax experts with 15 years of experience
- A CPA or EA to review your tax return, line by line, and sign it to ensure it’s completed correctly
Keeping in mind everything we’ve discussed in our QuickBooks Self-Employed review so far, let’s explore the top benefits of this accounting software.
Here are four of the most notable advantages to consider:
On the whole, the cost of QuickBooks Self-Employed is pretty affordable.
Even with the most basic version of this software, you’ll receive significant accounting tools for managing your expenses and taxes for just $15 per month.
If you’d prefer to test out the software before you commit, you also have the option for a 30-day free trial. Keep in mind, though, if you opt for the free trial you will not be able to take advantage of the three-month discount.
Mileage tracking is an extremely useful automation tool for independent contractors and freelancers, and not all accounting software options come equipped with it.
With the QuickBooks app, you’ll be able to automatically keep track of how many miles you drive for your business, which will not only speed up your reimbursement but will also help you streamline your related tax processes to ensure you maximize your annual tax deductions.
If you’re a freelancer, contractor, or another self-employed professional, it’s very likely that you invoice your customers or clients. Whereas some accounting or tax-focused software platforms would require you to integrate with an invoice software, QuickBooks Self-Employed includes basic invoicing with all three of their plans.
Although this may not be the most advanced invoicing software, you can manage more of your core financial processes in one place—not to mention, you can do so regardless of your location. You can use the invoicing features from your computer, or on the go with your mobile device.
Plus, you can also sign up for QuickBooks Payments and receive payments directly from your online invoices.
With all three versions of this software, you’ll be able to efficiently manage your taxes, and maximize the business tax deductions you see through Schedule C.
Although the two Tax Bundle plans offer the greatest tools to help you optimize your tax processes, even the most basic plan will allow you to sort through your expenses and adequately prepare for tax season.
Plus, as this QuickBooks product is designed specifically for self-employed professionals, the tax tools are set up particularly for your needs and therefore, you don’t have to worry about sorting through a variety of options that may not apply to you that you would find with other business accounting software solutions.
Moreover, with the two higher-level plans, you have access to experts to help you file your taxes and pay them online. Not only is this a unique feature for business accounting software in general, but especially amongst platforms designed for freelancers and contractors.
Easy to Use
Finally, this platform is also extremely user-friendly and designed for a specific type of business owner. As an accounting software created for contractors, freelancers, and other self-employed entrepreneurs, the platform offers the functionality these professionals need, at a price they can afford.
In addition, the intuitive interface is easy to navigate and is accessible (as well as secure) regardless of location.
It’s quick and simple to sign up for an account, set up your information, connect your business bank accounts, and then use the software.
Despite these notable benefits of QuickBooks Self-Employed, this solution has disadvantages to consider as well—just like any other accounting software.
Here are a few downsides to keep in mind:
As a software designed specifically for freelancers and contractors, this platform is limited in its functionality compared to other accounting solutions on the market.
It’s largely similar to a tax software or expense tracker, especially in comparison to the other products QuickBooks offers.
This being said, if you need to be able to perform additional bookkeeping or accounting tasks, you’ll need to consider a platform with greater capabilities.
Difficult to Upgrade
Continuing off the previous drawback, another downside of this software is that you can’t migrate your information to QuickBooks Online. Therefore, if you grow your business and need more than your current plan can offer, you’ll have to start all over again if you want to use QuickBooks Online as your accounting solution.
In essence, this lack of migration functionality makes this option less than ideal for scalability.
Although we listed pricing as a benefit, it can also be a drawback—depending on your budget and the features you’re looking for. While $15 (for the basic plan) seems relatively affordable, when you consider the pricing of some competitors, you might find you can get a better price for what you need.
As an example, Wave is completely free accounting software. Even though Wave may not offer the mileage tracking tools that QuickBooks includes, they can offer more in-depth invoicing, receipt scanning, and more. In this way, if budget is your top-priority, Wave may be a better option.
Moreover, it’s also worth mentioning that for the higher-level versions of the Self-Employed plans, you only receive one state and one federal tax return filing. If you need to complete multiple filings, you’ll have to pay pretty significant fees—$119.99 for each additional federal tax filing and $44.99 for each additional state tax filing—on top of your monthly subscription fee.
How to Use QuickBooks Self-Employed
Now that we’ve explored the three different plans, their costs, and the overall pros and cons of this platform, let’s discuss a little bit more about how it actually works.
Connect Your Accounts
Once you’ve created your QuickBooks account, one of the first steps you’ll want to take is to connect your bank and credit card accounts.
You can do this by navigating to the “transactions” section from your dashboard, inputting your account information (shown below), and selecting your account import settings. You can complete this process using your computer or using the QuickBooks app on your mobile device.
Although you can manually import your expenses or add receipts on the go, connecting your accounts is the simplest way to get started tracking expenses and streamlining your processes.
Explore the Home Dashboard
The home dashboard is extremely user-friendly and intuitive. There are just five tabs on the left-hand side where you can explore your transactions, trips (or miles), taxes, reports, and invoices. Similarly, the mobile accounting app is also easy to use and makes tracking expenses even simpler while you’re on the go.
Through this dashboard, you can quickly see the state of your credit and bank accounts, expenses, and profit and loss statement. You can click on any of these reports to get more information. Moreover, the software sorts out any personal expenses, so you can easily separate your business financials and data.
If you click “Review Now” at the top of the dashboard homepage, you’ll navigate to your transactions report.
In this transaction report, you’ll be able to see your business profit, income, and spending—and categorize your spending as business or personal. You can even “split” transactions (shown below) to keep track of purchases where business and personal supplies are mixed.
Plus, you can easily add categories to further organize your expenses and make it simple to find business tax deductions.
Additionally, you’ll be able to create rules for trending and predictable expenses or payments to help you automate data entry. Unfortunately, you can’t add a journal entry or new category since they are strictly Schedule C categories.
Finally, you can also add new transactions and easily import receipts. If you’re using the mobile app, you can use the receipt capture feature to take a photo of a paper receipt and connect this to an expense.
Track Your Miles
Within the “trips” or “miles” section of the software, you can automatically track your mileage. Using the platform online, you can add individual trips, notes, and more—so you don’t have to estimate your mileage at year’s end. Additionally, you can also enable GPS through the app to track trips automatically.
Sort Through Taxes and Deductions
In the Taxes tab of the system, you can set up your tax profile, estimate your quarterly and annual tax payments, and set up reminders so you can adequately prepare for your business taxes and never miss a deadline.
View Profit and Loss Statement
In the Reports section, you can review your profit and loss statement, which summarizes your income and expenses to inform you of your profitability. You can also view your Tax Summary, which shows your taxable business profit and totals for Schedule C deductions. Moreover, you can access a Tax Details section which lists transaction information by category.
You can download these statements as Excel files to store in your records.
As you try and decide if QuickBooks Self-Employed is the right accounting software for you, it’s always worth exploring top alternatives, to determine if there’s another solution out there that could better serve your needs.
Therefore, whether you’re looking for additional features, scalability, or more affordable accounting software, there are certainly alternatives to consider.
Whereas QuickBooks Self-Employed caters specifically to freelancers and independent contractors, QuickBooks Online is more greatly designed for the small business owner.
With four different plan offerings and pricing ranging from $25 per month to $150 per month, QuickBooks Online has the ability to accommodate a much wider variety of small businesses.
Plus, QuickBooks Online builds on the capabilities of the self-employed version, providing more advanced tools for invoicing, accepting payments, running financial reports, managing estimates, sales tax, and bills—thereby offering a solution that covers a range of accounting tasks and can grow with your business.
Zoho Books Basic
On the other hand, if you’re looking for accounting software with similar capabilities, as well as greater growth potential—and outside of the QuickBooks suite—you might look into Zoho Books Basic.
The Zoho Books Basic plan includes the features you need as a freelancer or contractor, as well as additional bookkeeping and accounting tools such as estimates, financial reports, sales tax, 1099 tracking, recurring invoices and expenses, and more.
Moreover, for $9 per month, Zoho Books is extremely affordable—and with two additional plan offerings, this accounting solution gives you the opportunity to upgrade your platform easily as your business grows. Plus, if you want to explore Zoho Books for yourself, you can sign up for their 14-day free trial.
Finally, for an alternative that you can use completely for free, you might consider Wave accounting. One of the only truly free accounting solutions on the market, Wave offers significant functionality, is easy to use, and can be expanded using their paid add-on tools.
On the whole, Wave allows you to invoice customers, connect your transactions, track your income and expenses, view financial reports, manage receipts, and more. Additionally, Wave gives you the ability to access your accounting software on the go with their mobile app, as well as connect to their online payment or payroll tools to increase your capabilities.
It is important to note, however, that Wave does not include time tracking features, so if you want to be able to track your time through your accounting solution, Wave may not be the right platform for you.
The Bottom Line
As an affordable, user-friendly platform designed specifically for freelancers and contractors, there’s no doubt that QuickBooks Self-Employed is a software that can serve self-employed professionals well. With significant capabilities for managing expenses, preparing taxes, and tracking mileage, this platform can help you automate and streamline your processes.
However, this software does lack some accounting tools and room for growth, so business owners may want to consider a QuickBooks alternative. And if you’re still unsure, you can always sign up for a free trial and test the platform out for yourself.
Stacy Kildal is a contributing writer for Fundera.
Stacy Kildal is owner/operator of Kildal Services LLC—an accounting and technology consulting company that specializes in all things QuickBooks. From 2012 to 2017, Stacy has been named one of CPA Practice Advisor’s Most Powerful Women In Accounting.
Stacy is one of the three hosts for the QB Show and has also been featured frequently on Intuit’s Accountant Blog, Community “Ask the Expert” forums, at various Intuit Academy To Go podcasts, as well as hosting a number of Intuit Small Business Online Town Hall sessions.
She is a big fan of working mobile and has been recognized by Intuit as being an expert on QuickBooks Online, having written Intuit’s original courses for the U.S., Singapore and Canadian versions.