You’ve decided that one of the QuickBooks Online versions is the best bookkeeping software path for your business. Now, let’s get into the details and find out which level from the rainbow of options best fits your needs.

QuickBooks Online Self-Employed is the best option for you if you are just starting out as a sole proprietor with simple accounting needs, but would still like help organizing it all. QuickBooks Self-Employed allows for one user plus one accountant user. You can also separate business from personal spending, and create invoices, using QuickBooks payments to receive payment. The software calculates estimated quarterly taxes, tracks your mileage, and records Schedule C deductions, which are your business expenses. You can even track your bank and credit card activity in QuickBooks by downloading the accounts directly into the software. Basic reporting, including the Profit & Loss statement, and an Income Tax Summary, are provided for reviewing your business performance.

The right user for QuickBooks Online Self-Employed

So, what kind of work makes sense for QuickBooks Online Self-Employed? If you’re a writer, an Uber driver, or a real estate agent, for example, this version would be the right fit for you. Any individual needing to keep track of expenses or receipts, and mileage, would benefit from Self-Employed. These users would file their taxes within their personal tax return (1040) on Schedule C.

QuickBooks Simple Start includes an online account for one full-access user, with the ability to invite up to two accountant users. Data is automatically backed up in this version. Simple Start also offers bank-level security and encryption. With this version, a user can post unlimited invoices and estimates, charge sales tax, and snap photos of receipts, so they’re ready for tax time. You can also print checks, record transactions, and download bank and credit card transactions. The chart of accounts is limited to 250 accounts.

If you’ve previously used QuickBooks Desktop, you can import your data into QuickBooks Online (QBO). Include payroll as an added subscription feature, and you can pay W-2 employees and file payroll taxes.  You can also prepare and print 1099-MISC thru QBO. Lastly, you can customize QBO with reports and apps. There are 20-plus built-in reports for reviewing financial data. You can integrate with other available applications to further accommodate your business needs.

The right user for QuickBooks Online Simple Start

Simple Start is a great fit for someone like a graphic designer. Think of a service-type business that needs the ability to provide estimates, and then turn those estimates into invoices. The user can also track accounts receivables. Typically, this user pays all expenses on a business credit card. They would also need to ability to provide financials, including the Profit & Loss and Balance Sheet statements.

Have more QuickBooks questions? Schedule an appointment with our QuickBooks ProAdvisor today!

The next level for QuickBooks Online is Essentials, which includes everything mentioned in Simple Start and more. Essentials increases QBO access to three users with permission controls. It allows for managing and paying bills, including scheduling payments for later. Essentials also has an automatic invoice creation that can be set on a recurring schedule. With Essentials, a user can track billable hours by customer. Delayed charges and credits can be entered in Essentials as well. And, there is unlimited time tracking, but only for users. Another option that starts within Essentials is the capability of multicurrency. With financial reporting capabilities, you can compare sales profitability with industry trends using 40-plus built-in reports.

The right user for QuickBooks Online Essentials

Essentials would be good for a business such as a chiropractic clinic. They typically use a third-party software to manage billing and accounts receivables. They record revenue and payments using one customer in QBO. Most supplies and bills are paid using a company credit card. The business is large enough to require separate access for the owner, office manager, bookkeeper, and accountant.

QuickBooks Plus includes all the features of Simple Start and Essentials, and more. Plus allows for five users with permission controls. You also have the ability to invite an unlimited number of users to track their time and view reports in QBO Plus, which aren’t included in the permission-controlled user count.

Time-Tracking Only Users

A landscape employee who needed to enter time to a job would be the perfect candidate to have the QuickBooks Online app on his phone. They would be set up as a time-tracking only user. They can enter their time worked on a specific project for the day, or enter their time sheet for the whole week. They can also view a summary report to confirm they entered everything. However, this is the only area they have access to within QBO.

Reports-Only Users

The perfect reports-only user would be a board member, or investor. Someone you want to give access to your reporting, but nothing else. They can view all reports on QBO, except for the ones that include payroll or contact information.

Additional Features

Some additional features include the ability to track billable hours by customer, perform purchase orders, and track inventory. Inventory tracking uses the First In First Out method (FIFO).

Online Plus also adds the capability to set up class and location tracking. For example, if you are a contractor and you build various types in both the residential and commercial arena, you could set up classes based on the type of work, such as residential new build, residential remodel, commercial build, and commercial remodel. Whenever you create an invoice or receive a bill you would also note the type of class, as well as the project. Then on your Profit and Loss, you can run a P&L by Class and it will show the profitability based on each. This will help you see if your business is more successful in a certain area and where you need to improve based on the outcome. QBO Plus is limited to 40 class and location tracking types.

Location tracking can also be used to identify by region or multiple store locations, so you can run reports to confirm activity by each location. If one store is promoting better than another, you may want to run more ads focusing on the high-performing store to promote more business.

QBO Plus also can prepare and print 1099-MISC forms, prepare budgets, and provide estimates. There are more than 65 reports available in Plus and you can customize and save reports for easy reference.

The right user for QuickBooks Online Plus

In summary, Plus is ideal for various types of businesses mentioned in the above, including contractors and landscaping companies. Companies are a good fit if they have an owner(s), a bookkeeper, an accountant and CPA, plus other time-tracking users and reports-only viewers.

QuickBooks Online Advanced has all the features of QuickBooks Online Plus, but with more benefits and functionality designed for larger, more robust businesses. Advanced allows for up to 25 users with full and simultaneous access, and three Accountant users. It also allows for customized user permissions to manage data access and delegate use of product features for optimized productivity. The Advanced subscription gives you membership to what Intuit calls the Priority Circle. This offers a dedicated Customer Success Manager to help get the most out of QuickBooks. Any call to customer support routes your call to the front of the line. You also get full access to QuickBooks online training.

Another more comprehensive offering within Advanced is Smart Reporting, powered by Fathom. The in-depth analysis provides improved decision-making tools that help you assess business performance, monitor trends, and identify opportunities. The easy-to-understand reports give insight into profitability, cash flow, and other key performance indicators (KPIs) that matter to your business. The dynamic reporting tool transforms your QuickBooks data into reports, graphs, and presentation-ready formats.

Other advantages to Advanced include batch import invoicing, enhanced custom field types, and no usage limits. Batch import invoicing allows hundreds of invoices to be created at at time by importing a .csv file. Enhanced custom field types can help you build more customized sales forms. There are no usage limits for the chart of accounts, locations, or classes.

Have more QuickBooks questions? Schedule an appointment with our QuickBooks ProAdvisor today!

Intuit recently notified users that the legacy QuickBooks Online Plus and below users over their usage limits will no longer be able to maintain overages as of October 28, 2019. Previously, Intuit said that if you already had accounts, locations, or classes over the limits prior to April 28, 2019, you could maintain them. The company has since changed their policy. As of October 28, 2019, all accounts must be within the above usage limits, or accounts will be suspended and forced to upgrade.

However, there is still a potential loophole that could allow you to maintain overage limits, without having to upgrade to Advanced. You can export your company to QuickBooks Desktop, then re-convert the company back to QuickBooks Online. Currently, when a company is converted from Desktop to Online, the converted accounts, locations, or classes are not counted within the usage limits. Not to say they won’t eventually change this policy, but it is a way to buy time from being forced into Advanced. For small companies with a basic setup that do not need all the intense offerings of Advanced or the higher price, this may be the way to go. Recommendations have been made to address the inadequacy of the setup, however no changes have been made on Intuit’s part to address the issue.

One great way to save money on your QuickBooks Online subscription is by connecting with a ProAdvisor/accounting firm that offers wholesale billing. The subscription will be paid for by the accounting firm and then billed to you the client by the accounting firm. The accounting firm is able to subscribe at a discounted rate and pass the discount along to the client. There are other temporary discounts offered by Intuit directly to QuickBooks users, but they usually only last 3-6 months.

A catch to this is if you already signed up yourself for QuickBooks Online. After November 1, 2018, QuickBooks Online customers could no longer switch to being a wholesale billing client from a direct client paid subscription. However, you can switch from one accounting firm to another and maintain your wholesale billing status.

In September 2019, QuickBooks Online Advanced launched the ability to create multiple checks at once. It has the same setup as batch invoicing. Another great feature that is currently being tested and rolling out across all QuickBooks Online levels is the capacity to track mileage. This has been only offered within Self-Employed, but they have seen the need across all levels. The initial offering only allows the Master Admins access to the Mileage tab, which means currently only the Master Admin has the capability to access the Mobile app to include their automatic tracking. It is also limited to one vehicle at this time. However, they do expect that will expand to multiple vehicles in the next phase.

Intuit is ever evolving QuickBooks and does listen to feedback, so any time you see a need for change, provide them with your feedback. It does make a difference.

If you ever have questions or issues, please contact Chortek and a professional ProAdvisor will be glad to assist you.