The 7 Best Accounting Apps for Independent Contractors in 2024
Essentially, as an independent contractor, you are not an employee of the business you are working for. An employee will receive wages regularly, have taxes withheld from those wages, have their schedules created by their employer. Join over 1 million businesses scanning receipts, creating expense reports, and reclaiming multiple hours every week—with Shoeboxed.
Features include financial reports, mobile apps, more than 1,000 integrations, live bank account connections, invoicing, and access for multiple team members. Xero customers also get free access to Hubdoc, which allows users to extract data from documents. Accounting software for independent contractors works like other accounting software in that you download the app, create an account, and start entering your data. It will also suggest categories for organization and store everything related to accounting in one place. Most accounting apps can be integrated with other apps such as mobile banking, customer relationship management (CRM), and mileage tracking.
Working as an independent contractor
If you are an independent contractor, the IRS considers you to be self-employed — you aren’t an employee of any company. As an independent contractor, you can operate as a sole proprietor, a limited liability company (LLC) or an S-corporation. The majority of businesses in the U.S. are run as sole proprietorships, so we’ll focus on that structure in this article.
That means every transaction that brings money in and each transaction that goes out of the business account(s). You are your own boss, you can set your own hours, and you have more freedom than working as an employee where everything is dictated by someone else. → Any income you received or earned is not considered salary or wages. If you are an independent contractor, then you are self-employed.
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Not all accounting firms have experience working with different types of business entities– but we do. Our company worked with several independent contractors in different service realms. We understand the pain points that independent contractors accountant for independent contractor have and how to solve them. This service is designed to help independent contractors predict their customer demand and be prepared for it. Our part-time CFOs, take the data from your books, employ financial analysis, to project your future sales.
The costs of accounting software for independent contractors vary. There are free and paid versions, and typically the paid versions https://www.bookstime.com/ have more features. Some apps offer free 30-day trial periods and others offer discounts for paying annually in advance.
Wave Accounting
Independent contractors need to pay the IRS self-employment taxes. Currently, that means you will pay social security 15.3%-12.4% and Medicare 2.9%. Join over 1 million businesses scanning & organizing receipts, creating expense reports, and more—with Shoeboxed. Knowing how to do the accounting cycle yourself is a major feat. But an accounting software is highly recommended if you are an independent contractor.
