When running an LLC (Limited Liability Company), proper bookkeeping is crucial for managing your finances, tracking expenses, staying compliant with tax laws, and ensuring that personal and business finances remain separate. Whether you’re a single-member LLC, managing a small team, or a larger LLC with complex needs, the right software can help you stay organized and avoid costly mistakes.
Here’s a breakdown of the best bookkeeping software for LLCs, starting with FreshBooks.
1. FreshBooks
FreshBooks is a cloud-based accounting software perfect for single-member LLCs or small businesses. It’s user-friendly and designed for entrepreneurs, making it a great fit for LLC owners who want to keep track of expenses, generate invoices, and manage cash flow with ease.
Key Features:
- Invoicing: Create and send professional invoices and get paid online. Recurring invoices can also be set up for subscription services.
- Expense Tracking: Track business expenses such as utilities, office supplies, or travel, and categorize them for tax purposes.
- Bank Reconciliation: Link your business bank account to FreshBooks for easy reconciliation and accurate financial tracking.
- Reporting: Generate financial reports like profit and loss statements, balance sheets, and tax summaries to help with tax filings.
- Time Tracking: If you’re charging clients by the hour, you can track billable hours directly in FreshBooks.
Why It Works:
FreshBooks is ideal for small LLCs and solo entrepreneurs because it simplifies invoicing, expense tracking, and time management. The software is easy to navigate, and its mobile app makes it convenient for LLC owners who are often on the go. It’s perfect for businesses that need simplicity and efficiency in managing daily financial tasks.
2. QuickBooks Online
QuickBooks Online is one of the most popular and versatile accounting software options available, and it’s excellent for both small and growing LLCs. It offers a full suite of accounting tools that allow you to track finances, manage payroll, and prepare tax filings.
Key Features:
- Invoicing & Payment Processing: Easily create invoices and accept online payments through credit cards, ACH, or bank transfers.
- Expense Tracking & Categorization: Track expenses automatically, categorize them for tax deductions, and attach receipts for record-keeping.
- Bank & Credit Card Integration: Connect your LLC’s bank accounts and credit cards for automatic transaction imports and reconciliation.
- Payroll Management: Handle payroll and automatically calculate and file payroll taxes for employees.
- Custom Reporting: Generate detailed reports, including profit and loss, cash flow, and tax summaries, all tailored to your LLC’s needs.
Why It Works:
QuickBooks Online is perfect for LLCs of all sizes because of its ability to scale as your business grows. It’s particularly useful for LLCs with employees or those that need detailed reports and financial insights. The integration with payroll services makes it ideal for managing teams, and its ability to handle complex accounting needs makes it a top choice for many LLCs.
3. Xero
Xero is a cloud-based accounting software that offers a simple and modern interface with powerful accounting features. It’s a great option for small to medium-sized LLCs that need a reliable system to manage bookkeeping, invoicing, and expenses.
Key Features:
- Invoicing & Payments: Send customized invoices and accept online payments, with automatic reminders for overdue invoices.
- Expense Management: Track and categorize expenses for tax reporting and reimbursements.
- Bank Reconciliation: Automatically import and reconcile bank transactions from multiple accounts.
- Inventory Tracking: Track inventory and manage product levels, useful for LLCs that deal with physical goods.
- Multi-Currency Support: Handle international transactions in multiple currencies, ideal for LLCs doing business globally.
Why It Works:
Xero is excellent for small to medium-sized LLCs that need easy-to-use accounting software with strong invoicing and expense tracking features. The inventory management feature makes it especially useful for LLCs that sell products. Xero’s simple pricing structure and cloud accessibility make it a good fit for businesses looking for a balance between affordability and functionality.
4. Zoho Books
Zoho Books is part of the Zoho suite of business tools, offering a comprehensive accounting platform ideal for small and medium-sized LLCs. It’s particularly useful if you’re already using other Zoho products, such as Zoho CRM or Zoho Inventory, as it integrates seamlessly.
Key Features:
- Invoicing & Payments: Create and send customized invoices with automatic payment reminders for clients.
- Expense Tracking & Categorization: Track your business expenses, categorize them, and set recurring expenses for bills like rent or utilities.
- Bank Reconciliation: Connect to your bank accounts for automatic transaction import and easy reconciliation.
- Automation: Automate workflows like recurring billing, approvals, and email reminders.
- Tax Management: Manage taxes with automatic tax calculations and prepare your LLC for tax filings.
Why It Works:
Zoho Books is great for LLCs that need automation and integration with other Zoho apps or tools. Its ability to streamline workflows, handle invoicing, and manage expenses makes it a powerful solution for growing LLCs that want to keep everything in one ecosystem.
5. Wave Accounting
Wave is a free accounting software that provides all the essential bookkeeping tools an LLC might need, especially for small businesses or startups on a budget. It’s a great option for LLCs that don’t need advanced features but still want a professional solution for tracking finances.
Key Features:
- Free Accounting & Invoicing: Send unlimited invoices, track payments, and manage expenses at no cost.
- Bank Connections: Automatically import bank and credit card transactions to stay on top of your finances.
- Expense Tracking: Categorize expenses, attach receipts, and generate reports to track your LLC’s spending.
- Payroll (Paid): If needed, Wave offers paid payroll services with automatic tax filing options for an additional fee.
- Financial Reports: Generate basic financial reports like profit and loss statements and balance sheets for tax time.
Why It Works:
Wave is perfect for small LLCs or startups that are looking for a cost-effective bookkeeping solution. It offers the essential features most small businesses need to track income and expenses, send invoices, and prepare for tax season—all for free. It’s ideal for LLCs that need a simple, no-frills accounting tool without monthly fees.
6. Sage Business Cloud Accounting
Sage Business Cloud Accounting is a powerful solution for LLCs that need comprehensive bookkeeping tools, with a focus on inventory management and advanced financial reporting. It’s ideal for businesses that are growing and need a system that can handle increasing complexity.
Key Features:
- Invoicing: Create customized invoices and send them directly to clients, with automatic payment reminders.
- Expense Tracking: Manage business expenses and categorize them for tax purposes.
- Inventory Management: Track stock levels and manage inventory, making it perfect for LLCs that sell physical products.
- Reporting: Generate advanced financial reports, including cash flow statements, balance sheets, and profit and loss reports.
- Mobile App: Access your financial data and manage your books from anywhere with the Sage mobile app.
Why It Works:
Sage is a solid choice for LLCs that sell products and need detailed inventory management alongside their bookkeeping. Its strong reporting features are also beneficial for businesses that want to dive deep into financial analysis. Sage is perfect for growing LLCs that need more robust functionality than basic bookkeeping tools can offer.
7. Kashoo
Kashoo is a simple and affordable cloud-based accounting software designed for freelancers and small LLCs. It’s ideal for LLC owners who are new to bookkeeping and want a straightforward tool to manage their finances without getting overwhelmed by features they don’t need.
Key Features:
- Invoicing: Create and send invoices with built-in payment options for clients.
- Expense Tracking: Track business expenses, categorize them, and attach receipts for easy record-keeping.
- Bank Integration: Connect your bank accounts and automatically reconcile transactions.
- Tax Preparation: Organize your expenses and income in categories that make tax filing easier.
- Financial Reporting: Generate financial reports to see how your LLC is performing and to help with tax preparation.
Why It Works:
Kashoo is perfect for small LLCs or sole proprietors who need simple, easy-to-use bookkeeping software. It doesn’t overwhelm users with features and provides all the essentials for tracking income, expenses, and invoicing clients. It’s an excellent tool for LLC owners who want to manage their own books without hiring an accountant.
What to Consider When Choosing Bookkeeping Software for LLCs
1. Invoicing & Payment Tracking
Choose software that allows you to send invoices easily, track payments, and set up automatic reminders for clients. This is crucial for managing cash flow in an LLC.
2. Expense Tracking
Your software should be able to categorize expenses and track spending across different areas of your business. This is essential for preparing taxes and understanding your financial health.
3. Bank Reconciliation
Look for software that integrates with your business bank accounts and credit cards, allowing you to automatically import and reconcile transactions.
4. Payroll Management
If you have employees, choose software that offers payroll management with automatic tax filing. This will save time and help you avoid costly payroll mistakes.
5. Tax Preparation
Make sure the software offers easy tax reporting and integration with your local tax rules. It should generate reports that help you prepare for quarterly and annual tax filings.
Comparison Table for Quick Review
| Software | Best For | Key Features | Price Range |
|---|---|---|---|
| FreshBooks | Small LLCs, solo entrepreneurs | Invoicing, expense tracking, time tracking | Starts at $15/month |
| QuickBooks | Small to growing LLCs | Invoicing, payroll, bank reconciliation, detailed reports | $30+/month |
| Xero | Small to medium LLCs | Invoicing, bank reconciliation, multi-currency support | $13+/month |
| Zoho Books | Growing LLCs with Zoho integration | Invoicing, automation, expense tracking, tax management | Starts at $15/month |
| Wave | Small LLCs, startups | Free accounting, invoicing, expense tracking | Free |
| Sage Business | LLCs with inventory needs | Invoicing, expense tracking, inventory management, reporting | $10+/month |
| Kashoo | Freelancers, small LLCs | Simple invoicing, bank integration, expense tracking | $20+/month |
My Top Recommendation
For small LLCs and freelancers, FreshBooks is a great choice because of its user-friendly interface and easy-to-use features like invoicing, expense tracking, and time tracking. If you’re running a larger LLC or plan to grow, QuickBooks Online offers powerful scalability, payroll integration, and detailed reporting, making it ideal for more complex financial needs.
If you’re on a budget or just starting out, Wave is a fantastic free option that covers all the essential bookkeeping tools without any monthly fees. Zoho Books is a smart choice if you want to automate workflows and integrate with other Zoho tools, while Sage Business Cloud Accounting is excellent for LLCs that need strong inventory management.
Choose the software that best fits your current business size and complexity, and take advantage of free trials to see what works best for your LLC!