Save Time With Payroll Templates

For those of you with seasonal businesses, such as landscapers, painters, remodelers and other contractors, you may find this time of year you are doing lots of hiring (or will be soon), depending on the size of your business. And anyone who’s been involved with that process knows that it can be very time consuming! For those of you who are responsible for setting up the employee in QuickBooks, the payroll template could help you save some time.

payroll templateThe simplest way is to go into the Employee Center and click on Manage Employee information >Change New Employee Default Settings (shown on the right). But you can also access the Employee payroll template from the Company Payroll Preferences (below).

payroll template

Once in the the template,

  • payroll templateYou can choose the most common payroll items, such as hourly wage, overtime, holiday pay, health insurance, etc.; it’s up to you whether or not you enter any default rates.
  • You can select the Payroll Schedule or Pay Frequency
  • You can opt to have time data to create paychecks (I recommend that for job costing)
  • You can even set up some of the tax defaults. Some may leave Federal alone but most of you could set up some state defaults (shown below)

payroll template

The payroll template is good for new employees only, not existing or returning, but still very helpful for many of you.

For those of you who have been in QuickBooks for several years, do take a look at these additional fields in case  you haven’t; I think you’ll find them useful. 

payroll template

payroll template

So, check out the payroll templates and knock some time off the employee setup process! Let us know if we can be of any assistance.

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Are Your Workers Contractor or Employees

If you have workers in your business, you likely made a decision when you hired them as to whether they should be an employee or a contractor.  If all you hire is employees, then you have nothing to worry about.  But if you hire contractors, there may be some financial risk you may be taking that you may not know about.

Any person that runs a business as a sole proprietor that you pay money to for services rendered is usually considered a contractor.  One difference between an employee and a contractor is that an employee receives a W-2 and a contractor that you have paid more than $600 per year by check receives a 1099.  There are many other paperwork differences, and that’s the major one.

One of the biggest mistakes when a business owner hires a worker is thinking that they can decide to classify the worker as a contractor if they simply want to.  Unfortunately, it’s the IRS that decides on the classification, not the worker or the business owner.

What’s the Risk?

There is no risk from an IRS standpoint to classify a worker as an employee instead of a contractor.  There is significant financial risk if you incorrectly classify a worker as a contractor when they should be classified as an employee.  You may be liable for back employment taxes plus penalties and interest if the IRS re-classifies a worker from contractor to employee, and this can go back many years.

To calculate your risk, take roughly 20 percent of the payments you made to contractors.  This amount plus late fees and penalties can add up to what you could owe the IRS if you are mis-classifying workers and the IRS finds out.

IRS’s Employee vs. Contractor Rules

The IRS focuses on three factors to determine whether a worker should be a contractor or an employee: behavioral control, financial control, and type of relationship.

If you control both what and how a task is to be done, you should probably classify your worker as an employee.  If you can control only the results you want, you may be able to classify the worker as a contractor.

There are many other rules about this classification, so be sure to check with your tax accountant for more information.  Also, for those of you that love tax research, here’s a link that gives the full details of the IRS rules:

Having a successful business is all about taking calculated risks; however, you may not have known the risk you’ve been taking with contractors that you’ve employed.  For the IRS, misclassifying workers is a “red flag” area, meaning they are paying extra attention to it.  If you aren’t sure, then contact your accountant or an HR professional or even the IRS to help you decide.

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More Tools for Your Cash Flow Arsenal

While there is so much you can do with QuickBooks, there are still times when an add-on product offers features not found in QuickBooks – or with the same level of functionality.  I will put these in 3 “buckets” – invoicing, collections and cash flow.

First, invoicing.  While the desktop version of QuickBooks 2020 addressed some invoicing pain points, these 2 products still have some really nice features not found in QuickBooks Desktop or not at all in QuickBooks Online.

  1. Recur360
  • Recur 360 is great for invoices that are the same amount each time whether it be monthly, quarterly or annually.
  • The invoices are created in Recur 360 (pulling from your customer and items/products/services lists in QuickBooks), which is helpful when you want separation of duties, and syncs with QuickBooks.
  • Customers pay on your Recur360 portal
  • You can setup email reminders of almost due/past due invoices
  • Customers can pay on more than one invoice, you can setup payment plans (neither of which you can do in QuickBooks, and be notified of credit card expirations.
  • Customers can see account history
  • There is a setup fee but then they have a fixed monthly fee and the ACH rate is lower than Intuit.
  1. Bill & Pay

This is a product I’ve used for years and got started because it did so much more than QuickBooks.

  • Invoices are a created in QuickBooks then sync with Bill & Pay (B & P) – which works better for me because my invoices are rarely the amount each time.
  • Customers can pay on more than one invoice, you can setup payment plans (neither of which you can do in QuickBooks), and be notified of credit card expirations.
  • Customers don’t have to create an account to pay, but if they want to see their history online, they would need to create an account (email & password).
  • You can setup a reminder for almost due and then up to 3 for past due invoices.
  • If customers pay by ACH, B & P shows you the date it deposit to your bank account
  • There are simple instructions for you to place a payment link on your website which links back to your branded B & P payment portal.
  • There is no setup fee. You pay a monthly fee plus a per transaction fee (which covers any ACH transactions). The ACH fee is less than the Intuit ACH fees.
  • Use my invitation code MuirAssoc and/or this link and get a free 30-day trial.
  1. The third tool is for times if you are ever having problems getting paid – Collections

 While most businesses have a few slow pay clients, did you know that once an invoice goes beyond 90 days past due, your chances of collecting it drop by 40-80%?!   Unfortunately, many have had invoices go unpaid – and that definitely hurts your bottom line!  If you’re a sizable company, perhaps you have a collection agency that assists you on occasion.  But small businesses either can’t find a collection agency or don’t have the time to find one.

CollBox simplifies debt collection.  CollBox works with QuickBooks – both desktop and online, although the process is slightly different since the two products have different software coding.  You select the past due account(s) you want help and then answer a few questions, such as whether your customer has filed for bankruptcy or what’s the minimum amount you’ll accept to settle the account.  Collbox matches you with a reputable vetted collector for your industry.  You are shown the collector’s offer.  You owe nothing unless they collect.   Below are some screen captures from the demo I watched.

Cash Flow

You are also able to monitor progress and leave messages for the collector.Cash Flow

Of course, it’s to your advantage to monitor almost or past due invoices so you can hopefully avoid collections, but in case the need arises, you might want to check this out!

  1. Last but definitely not least is the Cash Flow Tool.

I’m really excited about this add-on product because the QuickBooks cash flow reports and graphs just don’t do enough for projecting out in your business and lots of my peers are using this both in their business and with their clients.  Cash Flow Tool works with both desktop and online versions of QuickBooks. You can track daily cash balance, easily determine the best time to pay bills or get on the horn to get invoices paid.  Cash Flow Tool can even alert you to day(s) when you’re out-of-cash (hopefully you won’t need that alert). You can see a bird’s-eye view of your historical cash flow for the last 12 months and with their patent-pending CashLearnTM (artificial intelligence), Cash Flow tool can forecast your cash flow for the next 6 months w.  Predictions improve as the AI gathers historical data.    You can also easily run “what if” scenarios.

Cash Flow

There are customizable dashboards so you can review what’s most important to you; They have over 30 business Key Performance Indicators (KPI), so you might use different dashboards depending on who needs to know what.  And if that’s not enough, you can export out to Excel using pre-formatted templates to customize even more.  There’s even a mobile companion app. A few “dashboard cards” I’d like to mention:

  1. Note in the screen shot below that you can easily compare quarters including “like” quarters (e.g. 1st quarter last year to 1st quarter this year – they are in a darker color).
  2. The Cash Flow Tool also monitors cash flow ratios such as Quick and Current which are used by loan institutions and indicators of how your business is doing, not seen in your P & L.

If you want to learn more or see videos, go to  You can sign up for a demo/ or check out their Lite (free) version (forecasts 4 weeks instead of 6 months) or purchase a subscription for the 6 months projections, “heat” map and more.  Receive a 10% discount on your first year when you enter Monica10 on their billing page.

If you try any of these products, I would love to hear how they work for you.

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5 Ways to Monitor Receivables to Get Paid Faster

Last time I discussed ways you can get paid faster that centered on invoicing and payments. Today I want to take a closer look at how to bring payments in sooner by using reports and other features in QuickBooks to help get paid faster.

  1. Monitor Your Accounts Receivable – There are several reports and tools in QuickBooks that can help you.
    • A/R reports – Under Reports>Customers & Receivables, there are several reports. My personal favorites are the A/R Aging Summary and the Open Invoices. What are yours?
    • Snapshot – The Company Snapshot in QuickBooks Desktop (QBD) can quickly alert you to those who are past due – they will show in red. (Don’t have that in your Snapshot? Click on Company>Company Snapshot or right-click on the Icon bar, then click Add and select Snapshots.)

Get paid faster

  • Income Tracker – The Income Tracker in QBD can quickly let you see how many invoices are past due and who owes.

Get paid faster

  • Sales (in QBO) – If you click on Sales on the left menu, QBO will pull up your invoicing (sorted by invoice number) giving you a view of who’s overdue, who’s current, and invoices that have been paid

Get paid faster

  1. Customer Center – In the QBD Customer center, you can quickly filter to see who owes, but if you want to see who’s almost due or who’s past due, you can customize the center to include those fields. Simply right-click on the list and select Customize Columns.  Then select the ones you want to see and move them in the desired order. You can choose when an invoice would be considered Almost Due in the Reminders section of the Company Preferences.

Get paid faster

FYI: You can choose what you consider Almost Due in the Reminders section of the Company Preferences

Get paid faster

  1. Send out reminders –
    • Before the invoice is due. If you have the Overdue column showing in your QuickBooks, you can quickly see the Almost Due (in yellow) or use your Collection Center to see who’s Almost Due and send reminders from there.  (If you don’t see the Collection Center, click on Edit>Preferences then Enable Collections Center found on the Company Preferences tab.)

Get paid faster

    • Send out reminders just after the invoice is due. You can use the Income Tracker or the Collection Center to help you email reminders
    • AUTOMATIC reminders is a great feature in Bill and Pay– it will automatically send out those notices for you – both before and after the invoice is due, saving many of you LOTS of time! (Be sure to use MUIRASSOC if you want to test it out).
    • Automatic Payment Reminders in 2020 – The 2020 QuickBooks Desktop (QBD) products now have an Automatic payment reminder feature so you don’t have to spend as much time on notifying customers. For more detail, click here.
  1. Monitor collections. I prefer the Collection Center over the Income Tracker because it shows both Overdue as well as Almost Due, with a section for notes (especially helpful if you have to make more than one call). It also lists all the invoices (number, amount due, days overdue), phone number and has a link to email a notice.   But the Income Tracker is a useful tool – you can filter by overdue invoices, sort and send out.  If you “lost” your Collection Center, you can turn that back on in the Company Preferences under Sales and Customers.
    • Get paid faster
  2. Shift to more fast-paying customers. Use the Average Days to Pay in QBD to help you sort through who’s slow and who’s fast. (Reports>Customers & Receivables>Average Days to Pay).  You can export the report out to Excel and sort on the average days to pay – might be a real eye-opener!   Slowly (or maybe not so slowly!) drop your slow pay customers (or change their terms).  If you have prepayments and shorter terms (like due on receipt or net 10 or net 15), that should definitely improve the average days to pay. While it might be somewhat tough to change older customers, your new customers won’t know any different.

Get paid faster

The 2020 Pro/Premier/Enterprise QuickBooks had a couple other features geared towards helping you get paid faster. And, if you are in 2017, you will need to upgrade before the end of May if you want to continue emailing invoices, accepting ACH and credit card payments from customers and downloading bank transactions.  As an Elite QuickBooks Solution Provider, we offer great pricing so let us know if you are interested in upgrading.

Hopefully collections isn’t an issue for your company, but if it is, then these suggestions should help you get paid faster.  Would love to hear which tip(s) you liked best!

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5 Ways to Get Paid Faster

Who doesn’t want to have money coming in sooner – especially this time of year? While there are a few general practices that come with an industry, maybe it’s time to make a few changes.

  1. Invoice quickly. The sooner the invoice goes out the door, the sooner you get paid.  If you can automate your invoicing, you get them out the door even faster.  And emailing invoices will not only get them to your customers faster, but save the time (and money) to print, stuff and stamp envelopes, and getting them to the post office and then being delivered to your customer. Here’s an article that discusses 8 ways to quickly create your invoices.
  2. Track what needs to be invoiced. The last thing you want is for the work to be done but the invoice not going out!
    • If you were invoicing off the estimate, you can use the Estimates vs Progress invoice.
    • If you use the Sales order feature (which can also be used as a work order), you can use the Open Sales Orders to track. This feature is available in Premier & Enterprise
    • Review unbilled time and expenses
      • Reports
        • Unbilled costs (Reports>Jobs, Time & Mileage)
        • Unbilled time (Reports>Contractor)
      • Income Tracker Time & Expenses – shows a total dollar amount (that will get you hustling!)
      • Invoice Time & Expense feature (available in Premier & Enterprise) separates billable time from billable expenses and can be turned on in the Time & Expense company preferences
  1. Change your terms. If your terms are currently net 30, can you change them to net 15? (With the Add/Edit Multiple Lists, you can quickly change the terms for your existing customers.)  Can you make your terms Due on Receipt for your new customers?
  2. Make prepayments a part of your business. Look at all the recurring monthly and annual payments you currently pay in your business.  You may have opted for quarterly or annually so you could get a reduced rate, so it’s definitely more common now. You can do the same thing – offer a reduced rate if your customer prepays you for the contract, or the season, or …   you get the picture.  If you are starting a project, maybe ask for a deposit up front – that helps ensure a commitment at their end in addition to any signed agreement- even if it’s a one-day project. Doesn’t need to be for the full amount, but it does give you cash to offset payroll and other expenses you might have.  Here’s an article I wrote on how to set it up and track it so you don’t see this big sale in one month and then nothing for the other months for which you provide service.
  3. Make it easy to pay you– eliminate some of their excuses! There are several ways you can do this:
    • ACH – customers can pay you online or give you the check information by phone
    • Accept credit cards – statistically customers will spend more if they can use a credit card – wouldn’t that be great if they spent more with you?!
    • Automate their payments so you can skip collections. If you accept credit cards, you can charge their card each month (or quarter or whatever your payment frequency is).  If you use the Intuit merchant services, you can set this up in QuickBooks so it’s all in one place (which saves time and money).
      • If you haven’t tried the Intuit merchant services (Intuit Payments) it’s worth a look. Keep in mind there’s great integration, NO contract and guaranteed lowest rates when you go through us instead of straight through Intuit.

As you can see, most of these are simple to implement. So what are you waiting for?!  Start getting those invoices out the door faster!

I’d love to hear what changes you made and how it’s helped you and the business.

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Working with Customer Deposits (Or Prepayments)

Do you take deposits up front from clients? Whether you’re in the construction industry, landscaping, trades or some other type of business, deposits up front help cash flow and enable you to pay employees and purchase materials for the job.  How they can be recorded in QuickBooks varies.

Many simply use Receive Payments to record the deposit.  Unfortunately, this understates your Accounts Receivable; I’ve even seen some with negative Accounts Receivable. So, if your true outstanding A/R is 75,000, and you enter a $10,000 deposit your A/R account would show $65,000.  With a short time-frame and few invoices, you can do the math in your head, but I don’t recommend this as an ongoing method, even it’s really simple.  From an accounting point of view, your balance sheet would be incorrect – definitely not something you could show a bank or investor.

Another method is to use the Progress Invoicing and invoice for the payment, so at least your receivables is correct. However, this shows income before you’ve done the work, so it’s still technically inaccurate.

For those of you who offer customers a discounted rate for paying for your work for the season up front, the complaint I hear from business owners is they see this huge number in the early season for income, which really does not reflect the work they’ve done. And in the remaining months of the season or project, your income is understated and can even show a loss for the business which really isn’t true.

I’ve also seen some record the deposit correctly, and then when they invoice, they enter the prepayment on the invoice.  In fact, I used to do to this. In many cases, the resulting amount due is $0, but that’s also what the invoice shows. So when you’re reviewing invoices, you don’t get to see the original amount and then the payment unless you actually open the invoice to see the detail. It may also confuse your customers if you send them a statement.  I found I wanted to see an actual invoice with an amount and then a payment applied separately.

The method I prefer is to invoice for the deposit, then invoice as you do the work, and use a credit memo to apply the deposit/prepayment to the invoice. That way the accounting is correct, you don’t overstate your income, and both you and your customer can easily follow the invoicing and payments.  (For those of you who file taxes on a cash basis, you will need to make an adjustment at year-end to show the money you actually received, which is not shown in this article.)

One-time Setup

  • Create an Other Current Liability Account for deposits (e.g. Unearned Income, Customer Deposits, Prepayments, Retainers)
    • List>Chart of Accounts>New>Other Current Liability
  • Create an Item for Prepayments/Deposits
  1. prepay
  2. Click on List > Item> New Item
  3. Type
    1. Service if upfront deposit or retainer for services
    2. Other Charge if up front deposit is for products
  4. Item Name – Prepayment or Upfront deposit… your choice
  5. Account is the Other Current Liability account created above

Handling Prepayment/Deposit

Record upfront deposit

  1. Create an Invoice for the job using the prepayment Item; you may want to use the memo at the bottom of the Invoice to make note of the deposit as well for reporting purposes
  2. Receive the payment against the invoice – this will show in your customer deposit “other liability” account on your balance sheet.

Applying Prepayment to an invoice

  1. Create an invoice for the work being done (this may be a progress invoice if you created an estimate or sales order)
  2. Create a Credit Memo (Customer>Create Credit Memo)
    1. Use your prepayment Item and enter the amount you are applying to the invoice
    2. When saving the credit memo, you’ll be asked if you would like to apply this to an invoice – say yes. If the customer has multiple invoices, be sure you select the correct invoice.
    3. On the memo line at the bottom of the credit memo, I like to make note of the invoice it’s paying – easier to follow in reports and statements.
    4. FYI, if you customize the footer of your invoice to show payment applied, if you choose to send this invoice to your customer, they will see the amount of their prepayment that is applied to the invoice.

Prepayments for a season –

prepayAnother scenario is you have a couple hundred or more customers who receive a discounted price for paying for the season up front. You don’t want to show all the revenue for the winter and the work you do is a fixed amount for a service you would normally invoice on a monthly or quarterly basis.  Rather than having to manually apply the credit memo to each invoice, you can use a memorized sales receipt.

  1. If the sales receipt feature isn’t turned on, go to Edit>Preferences>Desktop>Company Preferences and select Sales Receipt
  2. Invoice for payment for season (item posts to your customer deposit account as described above)
  3. Receive payment & deposit in bank
  4. The first line for the sales receipt would be your service (e.g. monthly maintenance)
  5. The second line of your sales receipt would be the portion of the customer deposit that is paying for this service
  6. This can be a memorized transaction (here’s an article if you need help memorizing a transaction)

Prepayment Reports

For a Summary Report of Customer deposits/prepayments:

  • Click on Reports> Customers & Receivables > Customer Balance Summary
  • Click Customize Report
    • On the Display tab, click on Advanced Options and select Rows = Non-Zeroprepay
    • On the Filters tab, click on Account, then select your Deposit/Prepayment liability account

  • If you intend to use this report frequently, click on the Header/Footer tab and name your report.
  • Run the report and then memorize


For a Detail Report of Customer deposits (this is what I use),

  1. prepay
  2. Click on Reports> Customers & Receivables > Customer Balance Detail
  3. Click Customize Report
    1. On the Display tab,
      1. Deselect Account
      2. Click on Debit and Credit
    2. On the Filters tab, click on Account, then select your Deposit/Prepayment liability account
  4. If you intend to use this frequently, click on the Header/Footer tab and name your report.
  5. Run the report and then memorize

You will see the original deposit and then the drawdown of the deposit.


If prepayments are common for your business, then periodically you will want to reconcile the deposit/prepayment account to clear out finished projects so they don’t stay in your reports, but that’s for another day.

Contact our office if you have any questions or need assistance.

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New and Improved Intuit Payroll Products

Payroll is one of those aspects of business that many are reluctant to change, but it’s worth evaluating from time to time especially since Intuit announced new offerings in late in 2019.   I have a chart comparing the products but wanted to give you some thoughts.

  1. Your Intuit payroll options are first determined by the version of QuickBooks you’re using – desktop or online, then by who handles the tax deposits and filings.
    1. Desktop payroll
      1. Enhanced (you do it all) – you can easily do direct deposit, e-pay and e-file
      2. Assisted (you create the paychecks, Intuit handles the state & federal tax filings)
      3. Full-service Payroll – You enter the hours (if they are hourly), Intuit handles the direct deposit, local, state & federal tax filings
    2. Online Payroll
      1. Core has replaced the Enhanced/Self-Service – there is no longer a Do-It-Yourself (DIY) option. Now the taxes are paid automatically and forms are filed as well.
      2. Premium (replaced Full Service for QBO). This now includes Core (see above), TSheets, access to an HR Center and an option for expert review in getting setup.
      3. Elite (new) – Elite QBO Payroll includes Premium (see above), plus Elite onboarding, TSheets Elite (includes geofencing), access to an HR Advisor, and the ability to job cost by project (if you use TSheets Elite)
  2. If you are using an add-on product for time-tracking, which versions of QuickBooks are compatible?
  3. Next, do you need to job cost your labor?
    1.  If you do, the best products are the desktop’s Enhanced or Assisted Payroll; they both can job cost by task and Class.
    2. If you are in QB Online AND you use TSheets, is job costing to the project is sufficient?  You also currently can’t use Class tracking so comparing labor costs between divisions may take more work.
    3. If you use an add-on product other than TSheets for time-tracking, you won’t be able to take advantage of the QBO Projects for job costing labor.
      1. Most of my clients using add-on products are using industry-specific apps which do so much more for them, so moving to TSheets is usually not a good option.
      2. Most of my clients who move from QB Online to QB Desktop do so for job costing labor (and more job cost reports).
  4. Decide who will handle the payroll tax payments and tax filings.
    1. If you’re new to QuickBooks, sometimes letting Intuit handle the tax portion while you get acclimated to QuickBooks makes sense.   Then later you can choose to do more of the payroll once you’re up and running and comfortable.
    2.  While I have many clients who are competent and can certainly handle payroll, I find some would be better off doing another aspect of the business. Payroll can be a time-consuming task and mistakes can be costly.
    3. 40% of small businesses pay about $850 (many much higher) each year, so you could quickly wipe out any savings from doing it yourself.  Intuit promises error-free tax filing and having Intuit handle your payroll can also help prevent fraud. Having that extra layer of protection can be worthwhile for many businesses.

If you decide to make a change with your payroll set up or want to price out your options, let us know.  As an Elite QuickBooks Solution Provider, I am able to get special pricing for my clients (Including lifetime discounts in some cases), help you select the payroll option best for your situation, and assist with setup and training if needed.

Posted in Business Finance, Cash Flow, Job Costing, Payroll, Productivity Tips, QuickBooks | Tagged , , , , , , | 2 Comments

QuickBooks Desktop vs. QuickBooks Online

If you’re in a desktop version of QuickBooks (Pro/Premier/Enterprise) you may be wondering if it would be better to move to QuickBooks Online (QBO) so you have remote access. For many of you, this is the time of year to get your books ready to go for the year so I thought this would be good to discuss pros/cons – and my opinion ;-)

Yes, Intuit has put a heavy emphasis on QBO, but they still have many more desktop customers than online (and those customers bring in more revenue), so they aren’t going do desert them!  While Intuit is spending a lot to continue to develop this product, they realize that their current online product doesn’t yet meet the needs of many of their customers, so they are still committed to adding new features and improvements for their desktop products.

If you’re on the fence as to which way you go, it’s wise to look at what the products have to offer BEFORE deciding.

Even though QuickBooks is part of the name, the online version of QB is VERY different from the desktop (2 different development teams) – just ask anyone who’s moved from one to the other! The look is definitely different as is some of the terminology, so anticipate a learning curve. Some have loved it, but I’ve had a few clients tell me they tried QBO and went back to desktop!  (And vice versa).  Also keep in mind that there are usually clean-up issues after you convert from desktop to QBO or vice versa – so do allow extra time.

QBO offers 24/7 access, no worries about updates or upgrades, automatic invoicing and bank downloads and a growing number of add-on apps.

However, with QBO, you pay a subscription PER company.  For some of you, that can add up!  If you do a 3-year comparison (Intuit supports their desktop products for 3 years), QBO can cost more than Pro or Premier.

If you’re in QBO or considering QBO, mobile access is probably a key enticement.  While easy to access, QBO is not nearly as feature-rich as the desktop product – and may never be.   Intuit has let apps solve for the weak areas, which can mean additional costs for you.  In particular, a couple areas that are limited are job costing and inventory, although there have been improvements in QBO in these two areas.

Class: If you want to run your P & L by your profit centers (often the different divisions in your company), you will need the Plus lever or higher to run a P & L by Class.

QBO has fewer reports and there are fewer ways to customize reports.  As I mentioned above, since the subscription is for only one company, you can’t run a combined financial for multiple companies like you can in QB Enterprise.

Intuit introduced Advanced QuickBooks Online which gives you more users, more Chart of Accounts, and more Classes and most recently a backup option.  Permissions are minimal in QuickBooks Online unless you sign up for the Advanced QBO.

If job costing is important to you, then here is what QBO has to offer and where there are shortcomings.

  • Projects (found in the customer section) – I will admit this has potential to be a nice feature (you can see both costs and revenue for a project) and a couple key metrics for your projects. If you use an add-on product other than TSheets, it won’t work with projects (the project field is not available in the API yet). If you can’t use Projects, then the subcustomer is what you would use for your jobs.  And then the only job cost report would be the P & L for the “sub customer”.
  • Estimates -you can create an estimate for revenue but not both costs and revenue
  • You can have now both a cost side for a product or service as well as an income side (especially useful if you invoice for time and materials).
  • You can finally progress invoice customers but you won’t have the ability to customize the invoice as much as you can in the desktop.
  • There is no Estimated vs Actual report so you use budgets for projects. (Personally, I don’t want to have to create both an Estimate AND a budget for every job.) Budgets use your Chart of Accounts, so, to run a Budget vs Actual for a job, you might find you have to put more detail in the chart of accounts since you can’t run an estimated vs actual using your items (products & services).
  • Job Cost Reports – If you use Projects, there are only a couple project reports – not the variety of job cost reports like you see in the desktop products.
  • Job costing labor has limitations. This is probably the biggest reason I have clients leave QBO for QB desktop.  While Intuit is making progress, they still have a ways to go.
    • Currently, if you use TSheets and QuickBooks Elite Online Payroll (TSheets is included in the Premium Online Payroll product but does not include job costing), you can track labor cost (including labor burden) to the project, but not at the task level.
    • If you outsource your payroll, there is a way to create a burdened hourly rate for an employee at the project level, but these numbers won’t pull into your financial statements (like a P & L)
    • The Project Profitability report does not include labor costs if you outsource your payroll – that data is in a separate report. There might be a workaround, but I have not tested.
    • Although you can track time by class in QBO, you can’t pull that time into a P & L by Class without doing a journal entry.
    • Job costing in desktop is still much easier and more powerful.

Some other areas to consider:

  • Sales Orders There is no sales order feature (which you can also use as a Work Order in QBDT). In QBO, you can use an estimate template as a sales order, but you can’t track back orders.  Also in QBDT, you can create sales orders from your Estimate, obviously not an option in QBO
  • Sales Tax – You’ll need to be extra careful in QB Online if you have track sales tax – especially if you have multiple tax municipalities. I’ve definitely heard of some issues from bookkeepers and accountants.
  • Fixed Asset List – QBDT has a nice Fixed Asset List (gives you detail without expanding your Chart of Accounts), but there is no such list in QBO
  • Price Levels/Rules – In QBDT, you can have automatic pricing based on customer or type of customer, but not in QBO
  • Backups – Intuit does keep your QBO backed up, but what if there was a major problem that happened as a result of an incorrect integration with a product or a bookkeeper making a massive mistake (either accidentally or deliberately)? You don’t have a backup to restore like you do with the desktop product unless you use Advanced QBO.  While you can export the data out, it’s not in a ready-to-go format that you could use in desktop QB.  Intuit has recently included ChronoBooks with their Advanced subscription for backups.  (If you use a lower version, check out Rewind)

For a more complete list, you can download my QB Feature Comparison Chart from this link.

So what are your options?  Personally, I still recommend the desktop versions of QuickBooks for anyone who wants job costing.  For remote access, here are some options:

  • You can use a product like GoToMyPC, SplashTop or TeamViewer and remote into your computer – and you have access to your entire computer. If you choose this option, I strongly recommend a Windows password and turning off your monitor(s) when you’re out of the office.
  • QBox is a way to share a QuickBooks data file. It locks the file allowing only 1 person to work in it, so not a good fit if you need concurrent users, but for just a couple people, this might be a viable option.
  • There are Intuit-approved companies who will “store” (host) your QuickBooks and data; this gives you remote access plus the ability to use QB Pro/Premier or Enterprise. You pay per month per user to access the remote server in addition to your software. If this is of interest, let me know and I’ll give you a few suggestions and things to consider.
  • Many 3rd party products work remotely, solving for your “need” and integrate with desktop QuickBooks. They tend to be either task-specific (e.g. time tracking) or industry-specific
  • You can buy a server designed for remote access. The Remote Desktop servers have to be more powerful than traditional servers because everyone is using both software and data, but they can be really nice when you have people working remotely or in different locations.  Your IT company may offer this service or have suggestions.  Most of my clients choose hosting over owning their own remote desktop server, but never hurts to ask about it.

If you still opt for QBO, just realize that you may need to find one or more products to integrate with QuickBooks or have work-arounds so you can do all that you need or maybe decide to do without.  Contact me if you want to discuss more or would like to see our discounted pricing on the QuickBooks products; we have deals you won’t get from Intuit directly.

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Profit Planning for 2020

In previous articles, I’ve discussed reviewing your existing sales and profitability to see if you wanted to make any changes.  Now it’s time to plan for your new year and profitability.

Many of you may have already worked on a business budget for 2020.  If you haven’t (and perhaps have not in the past), I encourage you to do so – no matter what size your business is.   If it helps, think of your sales, gross profit (profit after direct/job costs but before overhead expenses) and net profit (bottom line after all expenses) as goals you want to achieve. And I think you’ll agree that it’s much easier to hit a target you can see ;-).

Once your budget is in QuickBooks, it’s easy to monitor how you’re doing during the year, so you don’t have to do updating in spreadsheet or just wonder.  I find it can also help you pay closer attention to your expenses as well.  After all, you’ll want to keep those down so you achieve your profit goals!

If you’ve never done a budget before, you can have QuickBooks create a budget based on your past year.  If you do that, be prepared for odd numbers because QuickBooks will take your actual numbers and divide by 12 to give you monthly, so you will get actual dollars and cents – rarely even numbers like 500 per month.  But it can be a nice start for some

For those of you who have divisions or departments or services lines or locations (like landscapers, painters, builders etc.) you can also plan for each “profit” center – and QuickBooks can help with that, too. In fact, many of you probably have staff members how work up budgets for their area(s) of responsibility.

If you have multiple people working on the budget, then quite often Excel is where many people work up their numbers.  In fact, I find that’s where many work on their budgets anyhow since you can do more with formulas to help you with some of your numbers. The good news is, we can usually find a way to import those numbers into QuickBooks.

Once the budget is in QuickBooks you can get the following reports:

  • Budget Overview (great way to see your original budget as a whole)
  • Budget vs Actual – the default is by month, but you can do month, quarter, or year


Profit & Loss Budget Performance lets you evaluate where you are the time period you’re evaluating (e.g. month or quarter), and what your budget is for Year-to-Date as well as for the entire year.


You can even get a graph. Let’s face it, sometimes a picture (graph in this case), makes it easier for some aspects to jump out at you.


We have a separate article for “how-to” but if you want help with this, let us know!

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Profit Planning with QuickBooks Budgeting Tools

Our last article discussed the benefits of using QuickBooks to help you in your “profit planning” by taking advantage of the budget tools in QuickBooks.  So now you’re ready to use create your budget in QuickBooks.  The process is similar whether you’re in QuickBooks Desktop or QuickBooks Online – the screen captures should be helpful.

  • Select the type of budget

Start by clicking on Company > Planning & Budgeting> Set Up Budgets. If you’ve already set up a budget, that one will appear. You’ll be able to edit it or create a new one. If you haven’t created a budget, the window shown in Figure 1 opens.


Figure 1: You’ll start working on your budget by selecting its year and content.

  • Select Profit and Loss and click Next.

On the next screen, you’ll see you can have additional criteria, (Customer:Job or Class), so you can budget for individual customers/jobs or classes instead of by account only. I do NOT recommend this for a customer:job – use an estimate instead unless for some reason that can’t work. But for those of you who use QuickBooks Classes, you might want to select Class.  For now, we’ll leave this box unchecked. Click Next.


Figure 2: You can choose other criteria.

  • Determine the Content

Indicate whether you want to start from scratch with your own figures or let QuickBooks pre-populate your budget with last year’s numbers.


Figure 3: Using actual data will use actual amounts to the penny!

If you are using QB Online, here’s what you’ll see


When you click Create budget from scratch. then Finish, you see a window similar to the one shown below


Figure 4: Budgets in QuickBooks are account-based, so yours will be set up that way.

You can decide if you want to have the same amount for each month, such as rent, or if you want to vary the amount by time of year (income and payroll fluctuate seasonally for many contractors). While you can’t enter a total and ask QuickBooks to divide it across the months, there are some fast ways to get some numbers entered and QuickBooks will total for you.

  • budgetIf you know the amount you want for the year, but not how that breaks out per month, use QuickBooks pop-up calculator (a favorite of mine!)
    • Simply click in the cell, type in your total, then the “/” so you can divide by 12
  • When you click in the cell that has a number you want to use for each month, use Copy Across (found in the lower left-hand corner of the budget screen)  Guaranteed to be faster than you!  Perhaps you want to use one amount for the first few months, (e.g. you know you have a rent or insurance increase coming on a renewal month), then you can type in the new amount and copy that number across the rest of the year.


  • Perhaps you expect sales to go up a certain amount each month. When you click on Adjust Row Amounts, you can either use the 1st month or click in a specific cell and go from there.  You can adjust up or down, by percent or dollar amount.


As you can see, QuickBooks helps you get the numbers in quickly.

For those of you with varying numbers each month, perhaps a faster way would be to import your budget.  You might let QuickBooks give you a start by using last year’s numbers, but you can export your budget out to Excel, put in your desired numbers and then import back into QuickBooks.  Here’s how

  1. Export your last year’s budget to Excel (File>Utilities>Export>Lists to IIF).
  2. Open in Excel (you’ll need to use All Files (*.*) to see your exported budget
  3. Leave all the “funny-looking” jargon alone – it’s important!
  4. Delete the old numbers and enter your desired numbers (maybe you can even use copy & paste your new numbers) then save in the same file format as the one you exported (iif)
  5. Import your new budget into QuickBooks (File>Utilities>Import>Lists to IIF) and review!
  6. Once the budget is in, you have a great tool to help you monitor your progress during the year.  If you want help working with the QuickBooks budget, let us know!

Once the budget is in, you have a great tool to help you monitor your progress during the year.  If you want help working with the QuickBooks budget, let us know!

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