Best Accounting Software for Tracking Business Finances

Effective financial management is crucial for businesses of all sizes. The best accounting software for tracking business finances provides a comprehensive way to manage invoices, expenses, payroll, and regulatory compliance.

Modern accounting systems — whether cloud-based or desktop — automate bookkeeping tasks, synchronize bank transactions, and generate real-time financial reports.

For example, Zoho Books notes that each plan includes core features like invoicing, expense tracking, and bank integrations. Leading cloud accounting solutions offer anywhere-access and automatic data backups, while desktop programs give on-premises control.

In the U.S., top options range from free or low-cost tools for small businesses (Wave, Zoho’s free tier) to advanced cloud/ERP systems (QuickBooks Online Advanced, Oracle NetSuite) for larger enterprises.

This article examines key features of business accounting software, compares cloud vs. desktop models, and reviews major platforms – all focused on helping U.S. companies track their finances accurately and efficiently.

Key Features for Tracking Business Finances

The right accounting software should cover all essential financial processes. Common features include:

Invoicing and Billing: Create and send invoices, track client payments, and automate reminders. Most platforms (QuickBooks, FreshBooks, Zoho Books) provide customizable invoice templates and recurring billing features.
Expense and Receipt Tracking: Record purchases and bills. For example, Wave’s free Starter plan includes invoice creation and receipt scanning. Cloud systems often let users snap receipts with a mobile app.
Bank Feeds & Reconciliation: Automatically import bank and credit card transactions to streamline reconciliation. Xero and QuickBooks, for instance, sync with thousands of U.S. banks, matching imports to recorded expenses.
Reporting & Financial Dashboards: Generate profit & loss statements, balance sheets, cash flow reports, and other analytics. Most software has built-in reports (often unlimited in cloud plans) to give insights into profitability and cash trends.
Cash Flow & Budgeting Tools: Some solutions offer cash flow forecasting or budgeting modules (Xero’s cash flow manager, Zoho’s analytics, etc.) to help project future financial performance.
Tax and Compliance Support: For U.S. businesses, built-in tax tools (sales tax calculation, W-9/1099 management, payroll tax filings) are important. For example, Xero’s plans include W-9/1099 management and sales-tax tracking even at the base level, and QuickBooks makes it easy to prepare 1099 forms.
Multi-Currency & Multi-Entity: Growing companies may need to transact in multiple currencies or handle multiple subsidiaries. High-tier plans (e.g. Xero Established, Zoho Elite/Ultimate) support multi-currency and intercompany accounting.
Time & Project Tracking: Freelancers and professional services benefit from integrated time tracking and project profitability reports (FreshBooks excels here). This helps invoice by hours and measure project margins.
Payroll and HR Integration: While basic accounting covers payables/receivables, many businesses also need payroll. Popular accounting platforms integrate with payroll modules (QuickBooks Payroll, Gusto for Xero, etc.) or add-ons.
Automation and AI: Modern cloud software automates routine tasks. For example, NetSuite notes that “cloud accounting software automates many time-consuming manual processes” (such as bank reconciliation and reporting), reducing errors and saving time.
Security and Backup: Cloud vendors provide enterprise-grade security and automatic backups, while on-premise solutions rely on each company’s own IT. Secure access controls (user permissions, two-factor) are common features.
Integrations: The best systems connect to e-commerce platforms, CRM tools, payment gateways (Stripe, PayPal), and other business apps. This creates a unified financial picture.

In practice, even entry-level accounting plans include most basics. As one finance guide notes, “each plan includes features like invoicing, expense tracking, and banking integration”. Additional bells and whistles (advanced reporting, inventory, project accounting) come in higher tiers.

In summary, look for software that covers invoicing, expense management, bank reconciliation, and reporting as core features, with optional add-ons for payroll, inventory, or analytics as needed.

Cloud vs. Desktop Accounting Software

A primary decision for U.S. businesses is choosing between cloud-based and desktop accounting software. Both handle core finance tasks (recording transactions, billing, taxes, reports), but they differ significantly:

Deployment & Access: Cloud accounting software is hosted online by the vendor. Users access the system and data in a web browser or mobile app from anywhere. There’s no software to install on PCs.

In contrast, desktop accounting software is installed on specific computers, and companies must buy a license upfront and install it locally.

With desktop software, financial data lives on each user’s machine, so remote access typically requires VPNs or file-sharing.
Pricing Model: Cloud solutions use a subscription (SaaS) pricing model. You pay a monthly or annual fee per user (and sometimes per features).

For example, QuickBooks Online ranges from $38 to $275 per month depending on the plan. Desktop software is traditionally a one-time purchase (with optional annual maintenance).

Recent trends show QuickBooks Desktop shifting to annual subscriptions (see below). Desktop costs can be high upfront (e.g. ~$1,000 per user/year for QuickBooks Desktop Pro).
Updates & Backups: Cloud vendors maintain the software, pushing updates and backups automatically. Users always run the latest version.

Desktop users must manually download patches and perform their own backups (or pay extra for hosted backups). Automatic updates in the cloud also mean instant compliance with new tax laws.
Collaboration: Cloud systems excel at collaboration. Multiple team members (including remote employees and external accountants) can work simultaneously on one up-to-date data set.

This eliminates the “multiple file” problem. Desktop software often limits collaboration; sharing a company file can be cumbersome and typically only one user edits at a time.
Automation & Reporting: Leading cloud systems automate many tasks and provide advanced reporting out of the box.

As NetSuite points out, cloud accounting can automate reconciliation and reporting, whereas desktop software often requires manual data entry and exporting. Cloud platforms also integrate seamlessly via APIs with other modern tools.
Scalability: Cloud solutions are generally easier to scale. You can usually add users or features on demand. For example, QuickBooks Online Advanced allows up to 25 users, while Xero has unlimited users in all plans.

Desktop systems require purchasing new licenses and potentially hardware upgrades to scale (e.g. adding users to Sage 50 Desktop can be complex).
Security: Cloud vendors invest in enterprise-grade security (encryption, multi-factor auth, intrusion detection). Desktop security depends on internal IT safeguards. Note that cloud vendors automatically backup data off-site, whereas desktop users must implement backup routines.

In practice, many U.S. businesses are moving to the cloud. Companies with distributed teams or remote workforces especially benefit from anytime, anywhere access.

A NetSuite guide reports that companies often switch to cloud accounting “because their requirements outstrip the capabilities of desktop products”.

However, desktop software may still appeal to firms with very limited internet access or those requiring full on-premise control (such as some government contractors with strict data rules).

In summary, cloud accounting software offers convenient subscription pricing, remote access, and strong automation, making it a best practice for most growing U.S. businesses. Desktop software can still serve specialized needs, but it requires more IT maintenance (updates/backups) and is less flexible.

Top Cloud Accounting Solutions

The U.S. market has several leading cloud accounting platforms. Here’s an overview of key options, with pricing and features:

QuickBooks Online (Cloud)

QuickBooks Online (Intuit) is widely used by U.S. businesses of all sizes. It offers tiered plans to fit various needs. Its current U.S. pricing (monthly, with annual billing options) is approximately: Simple Start – $38, Essentials – $75, Plus – $115, and Advanced – $275.

Each higher tier adds more users and capabilities. For example, Plus allows 5 users (250 charts of accounts, 40 class/location tracking) and Advanced supports up to 25 users and more automation. Core features include invoicing, expense tracking, bank reconciliation, sales-tax tracking, and basic inventory.

QuickBooks Online also supports multiple currencies (in Advanced) and project tracking. Payroll is sold as an add-on. Notably, QuickBooks Online makes 1099 filing easy: you can tag vendor bills for 1099s and generate the forms directly.

According to NerdWallet, QBO pricing “ranges from $38 to $275 per month” in 2024. Intuit has also announced price increases (e.g. Plus going to $115 from $99) by mid-2025.

QuickBooks Online is best for small-to-medium businesses seeking a comprehensive U.S.-market accounting solution. It integrates with thousands of apps (CRM, payroll, e-commerce) and has strong accountant support (QuickBooks Online Accountant).

QuickBooks Online’s strengths are extensive bookkeeping features, robust reporting, and a mature ecosystem; its downsides are higher price and complexity for very small firms.

Xero (Cloud)

Xero is a cloud-native accounting tool known for its clean interface and unlimited users. U.S. pricing for Xero (as of 2025) is: Early – $20, Growing – $47, Established – $80 per month (prices increase in late 2025, per Xero).

The Early plan covers basic bookkeeping (entering bills, reconciling bank feeds), but limits sales invoicing. Growing adds unlimited invoices and bills (up to 5 users). Established removes most caps and adds features like multi-currency support and project tracking.

For instance, only the Established plan includes multi-currency and expense claims. All plans include features like sending quotes, bills, and reconciling transactions. Xero also includes built-in sales-tax calculation and 1099 management, making it compliant with U.S. requirements.

Xero’s advantages: unlimited user logins (no per-user fee), strong bank integration, real-time dashboards, and extensive add-on marketplace (including popular payroll like Gusto). It’s especially popular with small-to-midsize businesses and accounting firms.

On the downside, Xero’s U.S. plans lack advanced inventory (requires add-on) and Xero’s support has been criticized. However, Xero’s 30-day free trial and monthly plans make it low-risk to test.

FreshBooks (Cloud)

FreshBooks is an easy-to-use cloud accounting system aimed at small service businesses, freelancers, and agencies. It’s particularly focused on invoicing and time tracking.

FreshBooks 2025 pricing tiers (with a promotional initial discount) effectively are: Lite – $21, Plus – $38, Premium – $65 per month (billed monthly).

A custom enterprise “Select” plan is also available. The Lite plan supports up to 5 billable clients (unlimited invoices), the Plus plan up to 50 clients, and Premium offers unlimited clients.

All plans include expense tracking, bank reconciliation, time tracking, and basic reports. Higher tiers add features like recurring billing, project profitability analysis, and customizable email templates.

FreshBooks stands out for its streamlined UI and mobile app. It automates invoice reminders, lets clients pay online, and even offers built-in proposal/estimate tools. Time tracking in FreshBooks converts hours into invoices seamlessly.

Drawbacks include relatively simple reporting (less than QuickBooks) and limited inventory features. Still, for small businesses prioritizing client billing and expense logging, FreshBooks is a strong choice.

Its pricing is competitive for the value: for example, FreshBooks Plus at $38/mo includes 50 clients, which is comparable to higher QuickBooks plans in scope.

Zoho Books (Cloud)

Zoho Books is part of the larger Zoho suite and is very price-competitive. It offers a free tier and multiple paid plans.

Current U.S. pricing (annual billing) is: Free – $0 (1 user + 1 accountant), Standard – $15 (up to 3 users), Professional – $40 (up to 5 users), Premium – $60 (up to 10 users), Elite – $120 (up to 10 users, advanced features), and Ultimate – $240 (unlimited users).

The free plan is especially useful for micro-businesses: it supports up to 1,000 invoices per year, expense tracking, bank reconciliation, recurring invoices, time tracking, and basic reporting.

Zoho Books includes strong features even at low price points: Standard adds multi-currency, purchase orders, and more API integrations. Professional/Premium add inventory, advanced projects, and vendor credits.

Notably, Zoho’s higher tiers (Elite/Ultimate) offer warehouse management and advanced analytics. Zoho integrates well with other Zoho apps (CRM, Inventory, Projects, etc.). It also offers built-in sales-tax automation and 1099 support to suit U.S. compliance.

The main limitations are a slightly steeper learning curve and fewer payroll integrations than QuickBooks, but the cost savings are significant. Zoho Books is ideal for small to mid-sized companies that want a full-featured solution at a lower price.

Wave Accounting (Cloud)

Wave is a standout free accounting solution aimed at freelancers and very small businesses. The Wave Starter Plan is $0 per month and includes unlimited invoicing, expense tracking, receipt scanning, and basic reports – essentially all core bookkeeping features.

Wave’s interface is simple and its security is solid. For more advanced needs, the Wave Pro Plan costs $16 per month and adds automatic bank transaction imports, unlimited users, customizable invoices, and priority support.

Because Wave’s core accounting is free, it’s extremely attractive to startups and solo entrepreneurs on a tight budget. There’s no user limit even on the free plan.

The trade-off is that Wave does not include payroll (you must buy it a la carte at standard rates) and Wave’s mobile app and integrations are more limited.

Still, Wave gives U.S. small businesses a remarkably powerful set of tools at no monthly cost. It’s often compared favorably to entry-level QuickBooks or Xero in terms of included features versus cost.

Sage Intacct and NetSuite (Cloud ERP)

For large or rapidly growing businesses, cloud ERP systems offer comprehensive financial management. Sage Intacct is a U.S.-based, multi-entity cloud accounting system used by mid-sized companies (not to be confused with Sage 50).

Oracle NetSuite is a global ERP platform. Both provide advanced features like multi-book accounting, complex revenue recognition (ASC 606), and extensive customization.

However, pricing for these systems is custom-quoted and significantly higher (often starting at several hundred dollars per user per month). NetSuite, for example, does not publish pricing – businesses receive quotes tailored to their needs.

These ERP solutions excel at handling multiple subsidiaries, intercompany consolidation, inventory and supply chain integration, and global operations. Small businesses typically don’t need this level of complexity.

But for a large U.S. enterprise tracking finances across many units, NetSuite or Intacct may be the only “best” choice due to their scalability and compliance features. (For comparison, NetSuite’s guide notes it’s generally on the higher end of the pricing spectrum but delivers an all-in-one suite of business tools.)

Desktop Accounting Solutions

Although cloud is dominant, desktop (on-premises) accounting software still exists and may suit certain businesses. Desktop applications are installed locally on Windows (or Mac) computers. Here are two notable desktop options:

QuickBooks Desktop (Pro/Premier/Enterprise)

QuickBooks Desktop is the traditional counterpart to QuickBooks Online. It comes in editions like Pro, Premier, Accountant, and Enterprise. As of 2025, Intuit has shifted to a subscription model for Desktop.

For example, QuickBooks Desktop Pro Plus (1-user) is now priced around $1,049 per year plus $310 for an additional user.

QuickBooks Desktop Enterprise offers advanced features (Advanced Reporting, inventory, advanced pricing, etc.) with subscription pricing (Intuit’s 2025 brochure shows entry-tier Enterprise at about $19/month per user on annual plans).

QuickBooks Desktop’s strengths are its depth of features and offline performance. It supports complex inventory, job costing, and industry-specific editions (manufacturing, retail, construction).

It also allows full multi-user access on a local network. However, it lacks the anytime-access convenience of cloud; users must either share company files or pay extra for “cloud access” services.

Given the recent price hikes, Desktop versions are becoming costly. Most new users prefer QuickBooks Online, but desktop remains relevant for businesses that need intensive inventory or prefer one-time/server-based systems.

Sage 50 Accounting (Desktop)

Sage 50 US (formerly Peachtree) is a desktop accounting solution aimed at small and medium businesses. It offers editions like Pro, Premium, and Quantum. Sage’s pricing starts around $59.50 per month for the Pro Accounting edition (this is a subscription price, billed yearly).

Premium and Quantum support more users and additional features like advanced budgeting and multi-location inventory. Sage 50 includes full double-entry accounting, payroll bundles, job costing, and time billing. It is feature-rich for a desktop program.

Like QuickBooks Desktop, Sage 50 requires local installation and database management. Its benefits are robust inventory management, strong reporting, and optional industry add-ons. Its downsides include a steeper learning curve and needing IT maintenance.

Sage also offers a Sage 50 Cloud version – a hybrid cloud that uses AWS hosting to mimic cloud access, but it still relies on the Sage 50 desktop software core.

Pricing and Feature Comparison

The following summarizes key pricing and features of major accounting software (cloud and desktop) as of 2025 for U.S. businesses:

Software / Plan	Platform	Starting Price (USD)	Users/Clients	Key Features
QuickBooks Online	Cloud	$38/mo (Simple Start) $75/mo (Essentials) $115/mo (Plus) $275/mo (Advanced)	1–25 users (varies by plan)	Invoicing, expenses, bank sync, P&L/balance reports, payroll addon, multi-currency (Advanced), 1099s.
Xero	Cloud	$20/mo (Early) $47/mo (Growing) $80/mo (Established)	Unlimited (all plans)	Bank feeds, quotes/invoices, bills, reconciliation. Includes W-9/1099, sales tax, multi-currency & expense claims (Established only).
FreshBooks	Cloud	$21/mo (Lite) $38/mo (Plus) $65/mo (Premium)	5–Unlimited clients	Client invoicing, expense tracking, time tracking, project profitability, estimates, online payments. Mobile app. Unlimited invoices (all plans).
Zoho Books	Cloud	$0/mo (Free: 1 user) $15/mo (Standard) $40/mo (Professional) $60/mo (Premium) $120/mo (Elite) $240/mo (Ultimate)	1–15 users	Invoicing, expenses, bank reconciliation (all plans). Adds multi-currency, PO, inventory, etc. in higher tiers. Integrates with Zoho suite.
Wave Accounting	Cloud	$0/mo (Starter) $16/mo (Pro)	Unlimited (Starter)	Free plan includes invoicing, expense tracking, receipt scanning, basic reports. Pro plan adds auto bank imports, unlimited users, custom invoices.
QuickBooks Desktop Pro	Desktop	~$1,049/yr (1 user)	1 user (for Basic Pro)	Full accounting, inventory, time billing, payroll integration. Locally installed. Now sold as annual subscription. Older perpetual licenses (no longer sold) required major upgrades manually.
QuickBooks Desktop Enterprise (Gold)	Desktop	~$19/mo/user (annual)**	Up to 30 users	All QuickBooks Online features plus advanced inventory, pricing, reporting. Cloud-accessible version of Desktop via AWS. Supports 1–30 users.
Sage 50 Pro Accounting	Desktop	$59.50/mo (annual)	1–5 users	Double-entry accounting, inventory management, multi-location, payroll (add-on), unlimited reports. Local installation; good for detailed inventory/finance management.

Note: All cloud products listed above charge monthly fees; some offer discounts for annual payment. Desktop prices shown are current annual subscription rates or one-time license equivalents. These starting prices correspond to the basic plans; higher-tier plans are available at higher cost.

For example, QuickBooks Online’s Simple Start at $38/mo covers 1 user with basic bookkeeping, whereas its Advanced plan at $275/mo supports up to 25 users and includes advanced analytics.

Xero’s Established plan ($80/mo) is the only tier with multi-currency and expense claim features. Zoho Books even offers a fully free plan for a sole user.

In contrast, QuickBooks Desktop Pro’s 2025 price is about $1,049/year for one user (plus $310 for each additional user seat), reflecting Intuit’s recent pricing updates.

Sage 50 Pro at ~$59.50/mo is a comparable desktop option for small businesses needing richer inventory and job-costing features.

Overall, cloud solutions tend to have lower entry costs (or free versions) and scale by subscription, while desktop solutions involve higher upfront or annual costs but may not require ongoing Internet access. Your choice will depend on balancing budget, feature needs, and IT preferences.

How to Choose the Right Accounting Software

Selecting the best software depends on business size, industry, and financial complexity:

Business Size & Budget: According to finance experts, small businesses typically spend $15–$100 per month on accounting software.

For example, QuickBooks Online Simple Start ($38) and Zoho Books Standard ($15) fit this range. Mid-sized companies often spend $100–$500 per month, enabling multi-user systems like QBO Plus or Zoho Professional.

Enterprise-grade firms start around $500 per month and can exceed $2,000, reflecting systems like NetSuite or Sage Intacct. Assess what features you truly need versus nice-to-have to avoid overpaying.
Industry Requirements: Some industries need specialized features. Retailers may need point-of-sale integration and inventory management (consider QuickBooks Enterprise, NetSuite, or specialty POS software that ties into accounting).

Service firms (consultants, agencies) often prioritize time billing and expense capture (FreshBooks or Zoho excel here).

Manufacturers might require advanced inventory/PCB costing (Sage 50, QuickBooks Enterprise, or a dedicated MRP/ERP system). Ensure the software handles any compliance/regulations unique to your sector.
Cloud vs. Desktop Preference: If you have reliable internet and want easy remote access, a cloud solution is generally better. For on-site-only businesses (with poor connectivity) or organizations requiring local data control, a desktop system might be chosen. Keep in mind cloud software now dominates most markets due to its flexibility.
Integration Needs: Consider other systems you use. Do you need tight integration with payroll (e.g. Gusto, ADP), CRM (Salesforce, HubSpot), or e-commerce platforms (Shopify, Amazon)?

QuickBooks Online, Xero, and Zoho Books have large app ecosystems. Ensure your accounting choice connects to your bank, payment processors, and any specialized software you rely on.
Growth & Scalability: If you plan to grow (more users, branches, international sales), pick a solution that can scale. Cloud plans allow adding users quickly.

Multi-entity support (for subsidiaries) is only in higher tiers or ERP systems. If you expect rapid growth, starting on a cloud platform will ease transition (moving from desktop to cloud later can be complex).
User-Friendliness: Finally, consider how easy the software is for your team. QuickBooks and Xero are generally user-friendly, while Sage 50 and ERP systems have steeper learning curves.

Most companies test software via free trials. Take advantage of free trials and demos to see which interface your staff prefers.

In summary, match the software to your current needs and future plans. For example, a sole proprietor might start with Wave (free) or Zoho’s free plan. A growing small business might use QuickBooks Online Plus or Xero Growing.

A larger business handling multi-location operations might require QuickBooks Advanced, Sage Intacct, or NetSuite. Consulting your accountant or a CFO advisor can also help narrow down choices based on your finances.

Pricing and Features Table

Below is a concise comparison table summarizing the key accounting software discussed, their deployment, starting prices, and notable features:

Software (Example Plan)	Deployment	Starting Price & Billing	Users/Clients Included	Key Features (Notable Capabilities)
QuickBooks Online (Simple Start – Advanced)	Cloud	$38–$275 per month (Simple Start $38; Advanced $275)	1–25 users (plans support up to 25)	Invoicing, expenses, bank feeds, sales tax, basic inventory. 250 accounts (Simple) to unlimited classes (Advanced). Integrates with payroll, POS, e-commerce. Strong 1099/1096 support.
Xero (Early/Growing/Established)	Cloud	$20–$80 per month (Early $20; Established $80)	Unlimited users (all plans)	Invoicing, quotes, bills, reconciliation. Early plan has limited invoices; Established includes multi-currency & advanced cash flow forecasting. Includes sales tax and 1099 management.
FreshBooks (Lite/Plus/Premium)	Cloud	$21–$65 per month (Lite $21; Premium $65)	5–Unlimited clients	User-friendly invoicing, expense capture, time tracking, project reports. Lite supports 5 clients, Premium unlimited. Ideal for service businesses and freelancers.
Zoho Books (Free/Standard/Professional/etc.)	Cloud	$0–$240 per month (Free–Ultimate)	1–15 users (tier-based)	Full accounting: invoicing, bills, bank reconciliation (all plans). Higher tiers add multi-currency, purchase orders, inventory, custom roles. Strong integration with Zoho ecosystem. Unlimited reports and client portal.
Wave Accounting (Starter/Pro)	Cloud	$0 per month (Starter); $16/mo (Pro)	Unlimited users	Starter (free): invoices, receipts, expenses, basic reports. Pro adds automatic bank feeds, unlimited collaborators, custom invoices, priority support. No limit on clients or transactions.
QuickBooks Desktop Pro	Desktop	~$1,049 per year (1 user)	1 user (with subscription)	Robust accounting with inventory, fixed asset management, time billing, and customizable reporting. Requires Windows PC. Offline use. File sharing for up to 3 users (Pro), more with Enterprise edition.
Sage 50 Pro Accounting	Desktop	$59.50 per month (annual)	Up to 5 users	Traditional desktop accounting: invoicing, bills, inventory across warehouses, payroll (add-on). Includes budgeting, customizable reports, job costing. Geared toward detail-oriented SMBs.
Oracle NetSuite	Cloud (ERP)	Custom (quoted)	Configurable	Comprehensive ERP with financials, CRM, inventory, ecommerce. True multi-subsidiary, multi-currency support, advanced compliance (ASC 606). Ideal for mid-to-large enterprises. (Consultants quote pricing.)

(Prices are as of 2025, U.S. dollars. Cloud software typically offers monthly subscriptions; desktop prices may be annual subscriptions or one-time licenses as indicated.)

This table illustrates that cloud options generally start lower (even $0) and allow scaling by subscription, while desktop options have higher fixed costs. For example, Wave and Zoho Books begin at $0 (making them unbeatable for budgets). In contrast, QuickBooks Desktop Pro now costs roughly $1,050/year for one user, a sizable commitment.

When comparing features, note which systems include specific capabilities at base price. Xero and Zoho’s base plans already include tax and multi-currency (or have them in mid tiers), whereas QuickBooks Online may lock some features to higher tiers.

Analyze each platform’s plan details to ensure it covers your needs (e.g. does it provide payroll, project tracking, user limits, etc.?).

The above sources and table should be used as a guide – always verify current pricing on the vendor’s site, as costs can change (QuickBooks, for example, announced 2025 price increases across most plans).

Frequently Asked Questions

Q: What is the best accounting software for a small business?

A: For small U.S. businesses or freelancers, cost and ease-of-use are key. Wave Accounting (free) and Zoho Books (free or $15/mo tier) often top lists for budget-conscious startups. FreshBooks (Lite plan) is also popular for solo professionals needing simple invoicing and time tracking.

QuickBooks Online Simple Start ($38/mo) is another all-purpose choice. Evaluate whether basic bookkeeping features suffice or if you need more (in which case step up to QBO Plus or Xero Growing). Most vendors offer 30-day trials – use these to find which interface your team prefers.

Q: How do I know if cloud or desktop software is better for my business?

A: Cloud accounting is generally more flexible: you pay monthly and can access data from anywhere with the Internet. It also means automatic updates, backups, and easier collaboration across locations.

Desktop software requires installing on a PC and doesn’t allow remote access unless specially configured. As NetSuite notes, cloud solutions use a “pay-as-you-go monthly subscription” model with automatic upgrades, whereas desktop requires an up-front license and manual updates.

If your team needs to work remotely or share data with an accountant easily, cloud is typically better. If you have no internet access at times or must keep data locally for compliance, a desktop may be necessary.

Q: Are there any free accounting software options?

A: Yes. Wave Accounting provides a completely free Starter plan that includes unlimited invoicing and expense tracking. Zoho Books also offers a free tier for one user/one accountant with essential features. These can be great for sole proprietors.

Even if the core software is free, you may still pay for extras like payroll or payment processing. Always check for hidden fees: many “free” products make money on payments or payroll add-ons. But in terms of basic bookkeeping and invoicing, Wave and Zoho Books let you start at zero subscription cost.

Q: What kind of monthly budget should I plan for accounting software?

A: It varies by company size and complexity. Industry research suggests small businesses typically spend $15–$100 per month on basic accounting software. In that range you can get single-user plans like QuickBooks Online Essentials ($75) or Zoho Standard ($15).

Medium businesses often budget $100–$500 per month, unlocking multi-user plans and advanced features (e.g. QBO Plus or Xero Established). Large companies might spend $500+ per month, especially if they use ERP-class systems.

The right answer is: list needed features (users, transactions, payroll, inventory, etc.) and compare plan tiers. CFO advisors recommend not under-budgeting – very cheap plans can lack needed features, while over-spending on enterprise software wastes money.

Q: Can accounting software handle payroll and tax filing?

A: Many do, but often as separate modules. QuickBooks Online and Desktop integrate tightly with QuickBooks Payroll (billed separately) to handle employee paychecks and tax filings. Xero partners with services like Gusto.

Wave and FreshBooks offer payroll for an extra fee. Regarding taxes, most top U.S. accounting packages can calculate sales tax, record VAT/GST, and prepare year-end forms. For example, Xero and QuickBooks both support W-9/1099 handling, and tie in to 1099 e-filing services.

Always confirm that the software you choose supports the specific filings (federal/state payroll taxes, 1099s, 1098s, etc.) you need, or if it requires an add-on.

Q: Will my accounting software grow with my business?

A: Choose a solution with scalable plans or available upgrades. Cloud platforms like QuickBooks Online, Xero, and Zoho Books let you add users or move to a higher tier with more features as you grow.

NetSuite and Sage Intacct are built for scaling across thousands of users and entities. Desktop software can grow too (e.g. QuickBooks Enterprise supports up to 40 users), but it usually involves purchasing additional licenses or modules.

Generally, if rapid growth is expected, a cloud-based solution offers smoother scaling. Many companies start on an entry-level plan and migrate to a higher plan (or a different product entirely) when their needs expand.

Conclusion

Choosing the best accounting software for tracking business finances requires balancing features, price, and scalability. For most U.S. businesses today, a cloud-based system like QuickBooks Online, Xero, Zoho Books, FreshBooks, or Wave will offer the ease of access and integration needed.

These solutions cover core finance tasks (invoicing, expenses, bank reconciliation, reporting) out-of-the-box, and their subscription pricing makes costs predictable. Desktop options (like QuickBooks Desktop or Sage 50) still exist for specialized cases, but they demand more IT management.

Key factors to consider are your current business size and anticipated growth. According to CFO analysts, small businesses may start with plans costing under $100/month, while larger organizations may invest hundreds to thousands of dollars monthly for enterprise-grade features.

Always verify that any software you pick handles U.S. requirements such as 1099 forms and sales tax calculations. And take advantage of free trials to compare usability.

In the end, the right accounting software will streamline your bookkeeping, provide clear financial insights, and let you focus on growing your business rather than wrestling with spreadsheets.

With the options covered above, U.S. businesses of any size can find a solution that tracks their finances accurately and efficiently.