This article is part of an ongoing Best Accounting Software for Farmers series. Stay tuned for more reviews of 2022 agricultural accounting software.
Wondering how to create a balance sheet for your agricultural operation? What about keeping track of your biggest farm expenses? FarmRaise is researching top accounting tools to understand which software is easiest to use and best suited for your farm finances.
While bookkeeping may be many farmers’ least favorite part of running their operation, a good accounting system helps producers build a more profitable farm business. Accounting tools enable farmers to know where their biggest expense and income categories are so they’re equipped to invest in their highest returning ventures while keeping a level eye on major cost sinks. Good expense tracking hygiene also helps farmers capture their maximum tax refund come tax season.
Today, we’re going to do a deep dive on Intuit's QuickBooks, our farmers’ favored accounting tool. We estimate that about 15 percent of our FarmRaise customers currently use QuickBooks to run their farm, more than any other farm bookkeeping tool out there.
If you pay for most things on your credit or debit card, Quickbooks makes it simple to connect to your bank account and begin tracking and categorizing your expenses. You can add your own categorization rules as you go and build an expense-tracking system that’s specific to your farm.
Dealing with high fuel costs this year? What better time than 2022 to write them off on your tax return? Quickbooks makes it easy to track your mileage in real time by simply turning on manual tracking to convert those miles into a tax write off.
Snap a photo of your receipts while you’re on the go and upload them to Quickbooks for easy categorization. You can also manually categorize the line items in your receipt to more accurately track your expenses.
We’ve found that accountants are familiar with Quickbooks and enjoy working with this tool to help farmers do their end of year taxes.
If you run your farm business like my family does, you probably write a lot of checks for farm expenses. Unfortunately, paper check transactions all have to be manually categorized in Quickbooks instead of automatically categorized (the check number isn’t enough for Quickbooks to identify the purchase type). This manual categorization can get really time consuming.
If we’ve heard farmers tell us one thing that they wish their accounting tool does, it’s categorizing the individual expenses of the farmer’s receipt. Quickbooks has the farmer do this manually, but if they could digitally parse and categorize these line items for the farmer, that would be a major upgrade.
Producers will need to build their own expense categories into Quickbooks; pre-made categorization system, which can be frustrating for a farmer who isn’t familiar with the farm’s Schedule F tax form categories. To better appeal to farmer users, Quickbooks should include a template - ideally one that mirrors the farmer’s tax form - that farmers can use to pre-fill the categories they’ll use to label their expenses.
When weighing the advantages and disadvantages of the software, the cost might sway you. Depending on your needs, Quickbooks can cost between $12.50 per month for the most basic plan (which includes expense tracking) up to $90 per month for the most advanced plan (which includes advanced business analytics).
For farmers who are comfortable spending most expenses via debit or credit card and are ready to self-design a farm expense tracking system, Quickbooks is a great tool that will help you run a better business (and your accountant will thank you for using).
This post is written by FarmRaise CEO Jayce Hafner. Do you have a farm accounting tool that you use and love? Send a review to firstname.lastname@example.org and we’d love to chat about publishing it!
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