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No. of Recommendations: 4
Can you say "taxes?"

You can use the shoe box method: All costs of doing business (gas, lights, phone, rent (you are going to charge yourself rent aren't you?), paper, computer disks etc.) in one box and All billing records in another shoe box. Then several times a year you can dig'em all out and add'em all up.

OR

You can put it all in your computer via QuickBooks and have it all added up any time you look at it.

BTW QuickBooks also keeps track of who owes you how much and for how long.


I'm not sure that QuickBooks is the only way to go for this. If the OP does not have any accounting software whatsoever, then I would agree that QuickBooks is probably the way to go. But if the OP already has Quicken for personal use, then I would be reluctant to upgrade to QuickBooks just for the business that he described.

I do all the books and any activity having to deal with money for DH's business as a General Contractor. Like the OP, he is also a sole proprietor. As we already had Quicken, all I did was to set up categories in Quicken for the business with the appropriate sub-categories. And my sub-categories coincidentally match the categories on a Schedule C, so at the end of the year, I just run a report on DH's business category, and it spits out all the sub-categories as well. The numbers simply then go on the appropriate line for taxes.

For things like outside labor, I have a subcategory by person, so I can also generate 1099's based on that, and I track their address and SSN right inside Quicken.

For the invoices, I just use Word to type them up, and track them in Excel.

Now, I realize this is probably more work than having QuickBooks, but it is another way to do it, and it has worked well for me for the past 5 or 6 years. The advantage to me was that I was just using software that I already had and which I already use to track our personal accounts as well as the children's accounts.

I also love playing with numbers, doing the taxes, and building spreadsheets [I know - that makes me a sick person], so you have to take my opinion on this knowing that.

Depending on how much the OP wants to do automatically or what software the OP already has, he could go either with QuickBooks or with Quicken.

I just wanted to point out that there was another way to do this.
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