As an independent contractor, you have a lot more freedom than employees of most workplaces. You pay taxes on your own, set hours on your own, and you are your own boss. Any independent contractor’s understanding of their business will improve with a clear understanding of their financial situation.

People who work routine 8-5 jobs for a company are classified as an employee. The business they work for will withhold and report a portion bookkeeper independent contractor of the employee’s wages. A percentage of each check is withheld to fund unemployment, social security, Medicare, and tax liability.

Best Accounting Apps for Independent Contractors

If the Client will not be obligated to pay a retainer, then mark the second checkbox. The bookkeeping services agreement is between a client and a bookkeeper to provide accounting services for a one-time or monthly basis. The bookkeeper will most likely have access to banking records, receipts, revenue details, and other financial information. Therefore, it’s imperative that the bookkeeper that is selected is someone who can be trusted. Accounting software for independent contractors works like other accounting software in that you download the app, create an account, and start entering your data.

This program is the standard for small business accounting, and it offers much more than an independent contractor probably needs. But it also features everything an independent contractor will likely need, including live bank connections, invoicing, payment processing, and mobile apps. It's easy to use, it can link up with your bank accounts and it's designed to make it as easy as possible to figure out your expense categories. It costs less that Quickbooks Self Employed and has more flexibility for customizing income and expense categories.

COMPANY

Make sure your software is up-to-date before working on your copy. If you do not have the appropriate PDF editor or word processing software then, use your browser to view, save, and print a copy to fill out manually. Both of the packages offer a free demo so you can check them out to see if the service is right for your business. Several customers on third-party review sites report problems reaching customer service or receiving a response to their problems. Although customer service reviews are mostly positive, some FreshBooks users report that they've been double charged, and customer support is not always responsive to these issues.

As a freelancer or independent contractor, you can qualify for small business credit cards. While you don't always need a business card as a freelancer, there are advantages to opening one. It makes separating business and personal expenses easier, while earning rewards along the way. Plus, business cards offer additional perks and tools designed with a business owner or freelancer in mind.

Never let your bookkeeping and accounting fall behind

What you (or your tax pro) will do is enter the total amount of income, and the total amount spent for each expense type. Keep your own record of the money your delivery business earned. If you use your car for deliveries, the portion of time you use the car is a reasonable and necessary part of running your business. It's a lot harder to find out you COULD have claimed it, but now you have to trace back and find out if you have a record of it.

You can also add on payroll through Gusto starting at $40 per month. Gusto was our top pick for best payroll for small businesses. It's more flexible than Quickbooks, it has a GPS app, and seems well designed. Stay tuned, I'll be putting out a review soon after I've had more time to add information to it. The advantage of a program is it's designed to do exactly what you want to do.