Quicken, QuickBook or MS Money

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mrsrobinson

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Mar 9, 2006
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I am currently self employed as a 1099 contractor. It's unknown how long I will be doing this. It's also unknown to me at this point if I will continue doing this or seek a more permanent, employer/employer gig.

Lots of folks have told me to get a copy of the above software and start tracking everything.

For those that do, which software has worked best for you and why? Also, for those who may know (and I do plan to meet with an accountant) what type of things should I be tracking?



Thanks
 
I don't know about the 1099 contractor stuff. . .but I do use Quicken for personal finances. Quicken will give you the ability to categorize all transactions, and split transactions across categories. Through the "reports", you can then dig out all the transactions of any given category across all accounts. This can help substantially if you are crazy enough to have both buisness and personal transactions in the same account.

You can do similar things with investments. . which could be relevant if you hold similar securities with different firms (say. . GE stock with both Etrade and a broker, or an S&P index fund in both a 401K and Vanguard.)

Quicken and MS Money are pretty much equal in capability from all I hear.

Can't speak to the buisness side. . .as I stated above.
 
Make sure you pay your quarterly estimated tax payments for Federal, FICA and Sate taxes. Read this for federal, you will have to research your local state regs.

http://www.irs.ustreas.gov/businesses/small/article/0,,id=115045,00.html

One of the down sides to being an independant contractor is that you pay a higher % for SS and Medicare. The self-employment tax rate is 15.3%. The rate consists of two parts: 12.4% for social security (old-age, survivors, and disability insurance) and 2.9% for Medicare (hospital insurance).Employees get "subsidized" by their employers.

On a postive note, there may be costs that you can deduct against your earnings.
 
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Vince_nj1 said:
Make sure you pay your quarterly estimated tax payments for Federal, FICA and Sate taxes. Read this for federal, you will have to research your local state regs.

http://www.irs.ustreas.gov/businesses/small/article/0,,id=115045,00.html

One of the down sides to being an independant contractor is that you pay a higher % for SS and Medicare. The self-employment tax rate is 15.3%. The rate consists of two parts: 12.4% for social security (old-age, survivors, and disability insurance) and 2.9% for Medicare (hospital insurance).Employees get "subsidized" by their employers.

On a postive note, there may be costs that you can deduct against your earnings.
Click to expand...

Yeah, I am on that. I missed the September one as I did not know. Getting ready for the January one.

I tell you what, having to write this check opens my eyes more on how much goes to Uncle Sam.
 
Greg,

If you are on a PC the Quicken Home and Business version works great. This one will give you the ability to create an invoice account that then becomes your receivables. Even if you are not giving your clients formal invoices, the functionality of the invoice account makes determining where your income came from a lot easier.

Quicken will also provide a mechanism of downloading transaction data from bank and credit card accounts, allowing you to track expenses without having to manually enter data.

Intuit does not have a Mac version that has the same functionality and that is the one reason I still keep an old PC around.

If your intent is to stay as a consultant, or contract worker, then QuickBooks may be too much since you won't need features such as asset accounting, payroll, account payable etc.
 
The number of different deductible expense categories you will have can probably be counted on one hand. I'm struggling with why one needs dedicated software for that when a spread sheet is more than adequate for a one-man contracting situation. You will spend more time just learning a new software package than you will keeping up with your costs.

Just because you can do it doesn't make it the best choice.
 
fwebster said:
The number of different deductible expense categories you will have can probably be counted on one hand. I'm struggling with why one needs dedicated software for that when a spread sheet is more than adequate for a one-man contracting situation. You will spend more time just learning a new software package than you will keeping up with your costs.

Just because you can do it doesn't make it the best choice.
Click to expand...

Thanks Frank, exactly the kind of stuff I need to hear. Again, folks around me are telling me to get a copy of the software to track. Our accountant uses QuickBooks, she suggested I start using it to make things easier...my guess is easier on her.

One a side note the Mrs and I have been talking about doing this anyway for our personal finances. I figured this coupled with my contract work now would make it a good time to purchase something and start.
 
I use an oler version of Quicken for personal finances and for several other LLCs and partnerships. It's great for doing online banking, but for the LLCs and partnerships which have few transactions I use an Excel spreadsheet. Heck, if you don't mind manually writing checks you can just use a one-write checkbook that basically keeps a manual spreadsheet for you.
 
Perhaps I have a bassakwards view of this, but my tax situation is complex and I will not use an accounting package; I only use spreadsheets. One of the reasons is that I don't want the accountant to just take my data and dump it into their system. It takes me a few hours at tax time, but I furnish them spreadsheet summaries of what I do and that forces them to make conscious decisions about how to handle each total.

As far as saving the accountant time? What saves them time is your being organized and thorough, not some fancy software package. A home accounting package could even cost you money. If you mis-coded one expense item and your accountant just input your data from a CD he may never even see it or question it.
 
Yes, Frank you are right on as usual. I should have mentioned that I supply the spreadsheets, not the Quicken files, to the tax guy.
 
Quicken is east to use you need to be a cpa to use quickbooks. It's horrible. Actually my uncle was a cpa and he had to hire someone to teach his staff how to use it.

Send a spread sheet to your accountant.
 
I agree with everything here. My tax situation also is not "simple".

I organize everything for the accountant. . and provide summary sheets. I don't like spending $250/hr for something they pass off to a $10/hr clerk.

Also, with the backup and summaries. . .it makes it easy for me to figure out what the answers should be in regards to the "easy stuff" in the return.

The only problem I have with Quicken is that if you download investment information, you are forced to upgrade every three years. A bit obnoxious . . .but it does allow an entire portfolio to be updated in a few moments. This updating feature is the primary benefit in my mind to quicken / MSmoney. The rest could EASILY be done with spreadsheets.
 
I've been using Quickbooks- Contractor edition for my construction business for the past four years. You said you were a 1099 contractor, but didn't elaborate further as to payroll, employees, etc. or what you need the software to do for you.

I need detailed job costing, and the ability to integrate payroll into the job costing as well. Payroll is a snap, I enter employee hours by jobsite, and cut the paychecks. My CPA has remote access to my office computer- weekly he takes care of payroll tax deposits by EFT. It's a snap- no payroll services, employee leasing, etc.

I know it inside and out, feel free to pm me if you'd like to discuss further.
 
Henry Boyd said:
Greg,

If you are on a PC the Quicken Home and Business version works great. This one will give you the ability to create an invoice account that then becomes your receivables. Even if you are not giving your clients formal invoices, the functionality of the invoice account makes determining where your income came from a lot easier.

Quicken will also provide a mechanism of downloading transaction data from bank and credit card accounts, allowing you to track expenses without having to manually enter data.

Intuit does not have a Mac version that has the same functionality and that is the one reason I still keep an old PC around.

If your intent is to stay as a consultant, or contract worker, then QuickBooks may be too much since you won't need features such as asset accounting, payroll, account payable etc.
Click to expand...

Exactly what Henry said.

After I retired from Delta, four of us started Cargo360 and we were initially paid via 1099s. Quicken (get the Premier version, the basic version won't work) generated my invoices, tracked 1099 payments, etc.
 
You are going to like Quicken! All you will need to do is enter 3 things. Invoices, bills and your checks. It's really fairly easy, and you can track a lot of information that you wouldn't need, but it is at hand just-in-case. Taking the 1/2 to 1 hour to navigate/learn the program will save you much more time in the future.

Since you are an independent contractor, and if you are on a cash basis, just print a profit-loss for the year and your accountant can fill in the schedule C for your taxes. Just itemize/catagorize your bills clearly as you enter them. (Rent, utilities, telephone, Business Meals, Supplies, Commissions (if you are using other contractors). Stuff that isn't deductible can be marked as such.
 
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I help my sister with Quickbooks. Accountants prefer it. If your just starting a business and dont have the time to learn the software a full time job in itself. Just have someone set it up exclusively for what you are doing. After that its basically data entry for you. I've found people just try to get by at first and then want all the reports that the higher end software provides later on. Its a guessing game sometimes transferring data from what the customer has to what the accountants what! Meet with your Accountant and ask what software they prefer and have them recommend someone to set it up for you. This may save you THOUSANDS of dollars later on when the accountant tries to guess what you were trying to do. Personally Id rather go to the dentist than my accountant. However a good accountant can save you lots of money.

My 02 cents
 
"However a good accountant can save you lots of money."

A little OT here, we like our tax accountant but how do I truly know she is also a good "contractor/self employed" accountant? Like law, do accountants pick a specialty? How do I know for sure she has found all of the possible tax breaks for me as a contractor?
 
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