The 10 Best Tax Apps for FreelancersBy Danielle Elliot April 27th, 2015
The calls from my mom start in January: “Have you done your taxes yet? You know it’s going to take me a while.”
I inevitably tell her, “I’ll get to it… the expenses… they just take too long.”
I’m the child of two CPAs, one of whom has her own income tax business and handles more than 300 clients during tax season (including a handful of my freelancer friends). According to her, none of their returns cause her quite as many headaches as mine. It’s understandable when you are paid by more than a dozen companies in a single year, but income isn’t even the hard part. It’s the expenses that get me.
My mom—almost neurotically—inputs her receipts and expenses into QuickBooks every night throughout the year. Taking the opposite approach, I wait until the last possible minute to start tallying everything, and we send about 30 emails back and forth as April 15 approaches. I’ve tried staying on top of it by keeping an Excel sheet or stuffing envelopes full of receipts each month, but year after year, my efforts fall apart for one reason or another. Mostly, because I’m lazy about it.
Considering how much time I spend on my phone, I started wondering if there were any apps that could make this process easier for the future. Of course there are, and in the week I’ve been using them, I’m already thinking they’ll make tracking expenses and receipts much, much easier.
For those who are also tax procrastinators, hopefully these 10 apps can help as you recover from the end of tax season.
The answer to my receipt debacle. You simply scan receipts, then zoom in and use your finger to circle the bill amount. It’s perfect, as long as it works properly. The first time I used it, it kept reading “97.79” as “37.79.” It worked the second time. If it doesn’t read the amount accurately, you can input it yourself. Once the correct receipt is logged, you name and tag it so you can quickly sort through in the future when they start piling up. Everything syncs with Evernote.
If you’re going to use Receiptmate, you’ll need Evernote to hold your scanned receipts. This app also helps you manage life in general—the smart scanner can read business cards just like Receiptmate reads receipts; the “Notes” feature lets you make notes on projects and instantly send them to coworkers or clients; it links to your calendar to help you stay on track of things. The app is not necessarily tax-focused, but you can use it effectively in tandem with Reciptmate.
Yes, the check-in arm of Foursquare. Why is this here? Mileage tracking. I usually have to go back through stories I filed to figure out the tedium of travel and mileage. Now that I’m checking in on Swarm, I can just search the name of the work event (i.e., U.S. Open) and see how many times I checked in there.
This app lets you scan and organize receipts with a bit more detail. When you upload a receipt, you can mark it as “reimbursable,” “deductible,” or “I’m not sure.” And once you hit “reimbursable,” you can attach it to the “contact” who should be reimbursing you (but it won’t alert them, don’t worry). Those features are downright genius… and then it gets even better. The app taps into GPS signals to track mileage—just hit “start trip” when you start moving. If you’re moving around from one location to another in a single day, this is a better option than Swarm. Plus, you can scan business cards. So basically, all of the things you might otherwise keep in a shoebox under your bed.
Expensify links to credit cards and bank accounts, so to create an expense report, you just call up the credit card account and add the related expense. In the week I tested it, I created expense reports for various categories relevant to taxes (meals/entertainment, subscriptions, etc). You can also input cash expenses manually or take a photo of the receipt. The app then reads the receipt and extracts relevant info. It, too, has a handy mileage tracker.
This scanning app lets you scan papers and receipts individually or in a batch (making it easier to file them together for a business trip). On a side note, it’s also great for contracts and anything that needs a signature because you can mark up the documents using your finger. Then you can quickly email, fax, print, etc. If design matters, this is the scanner app for you.
Beyond having a good scanner for physical receipts, it would be wise to have an app that keeps track of all your online purchases as well. Dashlane, in addition to being a password manager, gathers together all of those credit card purchases online in one place for free—it’s encrypted for safety—and gives you an itemized list of all your digital receipts.
Like Mint’s website, the app links to bank accounts and helps you manage expenses in whatever categories you select. It’s pretty smart about sorting them for you—but you have to stay on top of it to make sure it doesn’t add personal expenses to your business expenses. If you have a hard time staying on budget, or want to experiment with creating budgets in the first place, Mint is a great option.
This one covers all small business accounting needs. It links with bank accounts and credit cards, and seems to simplify income and expense tracking.
The blogger behind InvestorJunkie writes, “GoDaddy Bookkeeping is different, and in my opinion more user friendly, than an accounting program like Quickbooks… The main thing that sets GoDaddy Bookkeeping apart is the ability to track—and estimate—taxes. Specifically, quarterly and annual income taxes and sales taxes for sole proprietors, freelancers and other small businesses.”
The income and expense tracking features are free; tax estimations cost $9.99/month or $99.99/year.
Timely is not necessarily tax-related, but I think all freelancers should know about it. Since I’m not incredibly diligent about clocking in on various projects—including staying on top of my receipts— I use Timely to track hours, and the app sorts them by project. It makes invoicing so much easier at the end of each week. I chose this one because I like the look; other reviews recommend similar programs like Toggle or Mite.
All of these apps offer some sort of free trial, so definitely play around before deciding whether or not to take on a long-term fee. And if you have any other good suggestions, please let us know @daniellelliot and @TheFreelancer.Image by BillionPhotos.com