I'm thinking of activating the business features of my Quicken Premier 2007.
Will this handle more than one business? I have two small businesses that I
operate. I was going to use Quickbooks for one of the businesses but it
doesn't seem to handle brokerage accounts and stock trading activity. Since
Quicken does this just fine, I'm thinking of doing all my business
accounting inside Quicken.
Brokerage and Stock Trading is not a normal business activity for most
people and QuickBooks is targeted towards small businesses.
Quicken H&B could likely work for you -- there is not enough information to
make that decision (nor am I asking for it). A lot depends on how you
handle your businesses on your tax return. A possible scenario is to use
Quicken H&B but maintain three data sets (a collection of Quicken files) --
one for your personal, one for business 1 and the final for business 2. If
you treat your businesses as "one" on your tax return, then your decision is
to have one data set for the combined personal and business or two data
sets - one for personal and one for business. I would not track two
businesses within a single data set.
There are many different views on this. I would talk with a tax advisor on
how to set-up your recordkeeping.
Thanks for your comments. This is very helpful. I had resigned myself to
buying a separate Quicken H&B for the LLC since that reports on its own tax
return. Are you suggesting that I can create separate files for each entity
and use them with one licensed version of Quicken? I would just have to
load the correct data file when I am recording the transactions for each
particular business. Is that right or do I need to buy separate copies of
the program as I originally intended?
Thanks again for your help.
I'll add to Oilcan's comments as follows: You can use one Quicken file for
all three purposes -- personal, bus1, bus2 -- by adding a Tag (what used to
be called Classes) to each transaction. I have been doing this with H&B for
many years. Here are a few examples of what the Category/Tag would look
You can split any transaction between two classes. For example, if you take
a business trip and split the airfare between the two businesses:
For what it's worth, my accountant fully approves of the way I use
Quicken -- using Classes (tags) to separate personal and business
transactions. In addition, I've been audited by the IRS and the auditor
complimented me on my record keeping. I even use one checking account and
one credit card for both personal and business purchases, something the
accountant and IRS would recommend against, but since every transaction is
tagged to identify BUS versus PER (those are my classes), the Quicken
reporting is very accurate and efficient.
I agree with Oilcan that you might want to check with your accountant on how
best to set up recordkeeping for your particular situation.
If you decide to use a separate Quicken file for each business and your
personal records, you most certainly do NOT need to buy more than one copy
of Quicken. You may use as many data files as you like with Quicken. I
know an accountant who keeps records for a dozen or so clients all with the
same copy of Quicken.
Very cool. I'll check into this Tag function right away. Sounds like an
excellent solution. I appreciate your help.
And congrats on getting high marks from the IRS Auditor. I was a CPA in
public practice before I went to work for a client 20 years ago. I never
had an auditor compliment anybody. Great job.
I realize you said you are using Quicken 2007. Look for Classes, not Tags.
Intuit changed Classes to Tags starting in Q08. The examples I gave you
earlier are how you enter the into in Q07 and earlier --
Category:Sub-category/Class. In Q08, there is a separate field for Category
and another field for Tag. There is a Preference option to turn off the
separate field and make '08 work and look like previous versions. I so used
to the "old way" that I've continued working that way. In either case, it
is ESSENTIAL that EVERY transaction has a Class (or Tag) assigned to it, in
addition to the category. Without the Class/Tag, you won't be able to know
if the transaction applied to bus1, bus2 or personal, and reporting
(Quicken's strength) will be severely handicapped.
About the IRS comment... I'm a freelance photographer, working by myself out
of a home-office. Because of using Quicken H&B, I have never needed a
bookkeeper (although I do have an accountant for tax-time). I keep all my
own books using Quicken H&B, and have done so since 1991. I enter all
business (and personal) expenses in Quicken and I keep all receipts in
chronological order, as well as bank statements, etc. The IRS guy was
impressed that as a one-person business, I could put my finger on any
receipt or statement within seconds. He said that many small businesses
records are a mess. While it took him a little more time to go through the
random items he checked because I use only one checking account and one
credit card account for both personal and business, at the end of the day,
he found no errors and I owed them nothing. He got a little pissy about how
I allocate my telephone to part personal, part business, but he let it go.
(I do it differently now... I have multiple lines.)
By the way, I don't know if you will need to generate invoices using Quicken
H&B, but for me it has worked great doing that. The only slightly
complicated issue is sales tax if you do business in more than one area and
hence need to collect and report sales tax at different rates. Or, you may
have some sales that are taxable and some that are out of state or for
resale (and not taxable). If you are on a cash basis, it's a little tricky
figuring out how to do the sales tax thing because Quicken posts the sales
tax to the sales tax account when the invoice is created, not when it is
paid. If you are interested, post back here and I'll tell you how I deal
with all of this. Also, there is a thread in the NG "Quicken 2005 - Invoice
reports." Search for it and see if any of it is helpful.
Which is one of the reasons why I would personally NEVER comingle personal
and business accounts in the same Quicken file set. IMNSHO, you are better
off to create a completely separately Quicken fileset for your business (es)
(multiple ones per business if that is the fact) rather than trying to
'remember' or, even if you do, 'tag' transactions.
Google the archives, you'll see a number of posts on this subject on the
goodness of separately personal from business accounts.
Others disagree thinking it is ok to comingle, I say, why risk it at the
spite of just a little more of inconvenience to be managing two sets of
Quicken file sets?; ergo, YMMV.
For my situation, when I began using Quicken as I described, there were
benefits and risks to using one Quicken file for both personal and business
transactions. The risk or downside, as you point out, is that every
transaction needs to be tagged (or have a class assigned). The benefits --
for me -- outweighed that risk. Here's why:
-- Since I use only one checking account and only one credit card for both
business and personal (which I do because it's more convenient than having
two of each), both accounts are in the same Quicken file, along with
investment accounts, etc. Transfers all occur within the same Quicken
file -- quick and easy. Remembering to tag/class every transaction is not
an issue -- memorized transactions take care of 99% of that. Memorized
splits into percentages even happen automatically. As a safeguard, I run a
report from time to time looking for transactions that don't have a class --
it's easy to go back and add that if needed. I can't remember the last time
that report found a transaction without a class. I've been doing this for
so long that I automatically add a class after the category (if the
memorized transaction hasn't done that already).
-- I have many transactions that are split between business and personal:
Home-office (phone, Internet, utilities, etc.), auto costs since I use the
same car for business and personal driving, insurance, and others. One
check to pay any of these, split appropriately in one Quicken entry, and I'm
done. No need to write two checks -- one bus, one per -- from two
different Quicken files to pay these joint, split costs.
-- My entire financial picture is in one place, one Quicken file. I like
that. My Quicken home page is customized to show me just the stuff I want
and need to know about both my business and personal accounts.
I spent a good deal of time thinking through how I would use Quicken the way
I do. I did a lot of testing and was very careful my reporting would work
correctly and easily. It does.
Now, having said all of that, I am not recommending to Hal that he do what I
do. I was simply telling him what's possible. In my first message in this
thread, I said "I agree with Oilcan that you might want to check with your
accountant on how best to set up recordkeeping for your particular
situation." I am not an accountant. I am not a tax advisor. I think that
was clear in my two messages.
One of the great things about Quicken is how flexible it is. We each use it
in the way that's best for us. To each, his own.
Absolutely no harm or flames intended if that's what you thought.
That's way I said YMMV at the very end of my post ('your mileage may vary').
Whatever floats your boat. I was just reiterating another side of the story.
Keep those other cards and letters coming on other Q topics!
I saw no flames and detected no intent of harm, so all is well in that
department. I think we are both being responsible in relating multiple
options (some conflicting) in the use of Quicken. I see this discussion
being not about the right and wrong way to use Quicken, but rather about
different ways of using Quicken.
Thanks for the help JB. It's good to know all the angles. I'm going to set
up a different data file for the LLC, and maybe another one for the Schedule
C business. Or maybe I'll just keep the Schedule C in the original data
file. Haven't decided yet, but that's how I was handling the small
consulting business before.
BTW - in another lifetime, I was a corporate photographer for a Fortune 100
company. Got to travel all over the US, even photographed President Ford up
close and personal. Sold the Hasselblads, but still have the Nikon F2 in
closet someplace (I think).
Glad you got to see lots of options here. Yes, the conversation here is
mostly among gentlemen, but not always. Fortunately, that was the case in
this thread. It's so easy to disagree and do it politely (!), but in so
many online forums and NGs that doesn't happen.
Small world... I do primarily annual report shooting for large companies,
and have been doing so for almost 30 years. All digital now, and I love it.
I too sold all the Hasselblads and Nikon film cameras. I use a couple of
D2X bodies now and could not be happier. If you're interested: w w w dot j
o h n b l a u s t e i n dot c o m -- disguised deliberately.
Amazing! The one assignment I passed on but wished I did take was filming
the Alaskan Pipeline installation. That would have been one memorable
experience. But I hate the cold!
Are you able to use your old F2 lenses on the new digital Nikon?
I'm with you on the cold. I had to stand outside in Chicago in January one
year waiting for a truck to go around the block several time. Ouch.
Yes, I can use some of my old lenses, but I bought two of the new DX lenses.
Now, of course, Nikon is coming out with "full frame" digital bodies so all
the old lenses will work (and my two new ones won't). Not all old lenses
work -- they have to have autofocus and the electronic connections. Come to
think of it, the F2-era lenses may not work.
You can have as many different Quicken files as you want. Just use
File/Open... to open the desired file. Having one file for personal
use and another for business is a common practice. I did that when I
had a separate business. I also used a separate file for handling an
estate a few years ago.
I'm not doing any business things, just use Quicken 2008 deluxe (US). I
have more than one quicken file (set). The correct file set opens when I
double click a shortcut that points to the respective *.qdf file of each
set. I.e. one for the non-profit group, the other for my family finances,
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