FreshBooks vs QuickBooks Solopreneur (2026)

The easiest way to track income and expenses for a side hustle is to open a dedicated business checking account and connect it to a simple digital ledger that automatically imports transactions. For true solo operators who only need to track cash flow and capture receipts, Wave offers a free baseline, while QuickBooks Solopreneur ($20/mo) and FreshBooks ($23/mo ongoing) provide automated bank feeds, receipt scanning, and Mileage tracking to make tax preparation simple.

The First Step to Easy Tracking: Separate Your Money

Software makes income and expense tracking easier, but it cannot fix mixed personal and business funds. The Internal Revenue Service states in Publication 583 that one of the first things you should do when starting a business is open a business checking account. You should keep your business account separate from your personal checking account and use the business account for business purposes only.

IRS Publication 583 also notes that your business checkbook or bank statement acts as your basic source of information for recording business expenses. When every income item and business purchase runs through one dedicated card or checking account, your bookkeeping software can pull clean transactions via bank feed without requiring you to manually filter out personal expenses.

If you run a single-member LLC or operate under a trade name, obtaining an Employer Identification Number (EIN) and formal entity structure is usually required by banks to open a dedicated business account. Services like ZenBusiness help freelancers handle entity formation, get an EIN, and stay compliant with state filings before setting up bookkeeping software.

FreshBooks vs. QuickBooks Solopreneur: At a Glance

Selecting between FreshBooks and QuickBooks Solopreneur comes down to whether your side hustle is service-based and client-focused, or a simple solo operation geared toward streamlined tax filing.

Pricing verified as of October 6, 2026.

How FreshBooks Handles Side Hustle Bookkeeping

FreshBooks is designed around the client service lifecycle. If your side hustle involves billing clients by the hour, sending formal proposals, or managing project retainers, FreshBooks offers tools that extend beyond basic bookkeeping.

The entry-level plan, FreshBooks Lite, costs $23 per month as of October 6, 2026. FreshBooks frequently offers promotional rates, such as $1 per month for the first year on Lite, but $23 per month is the ongoing baseline cost. The Lite plan allows you to send unlimited invoices to up to 5 billable clients, track expense categories, and accept credit card payments online.

FreshBooks excels at time and expense tracking linked directly to specific clients. You can log expenses, take pictures of paper receipts on your phone, and attach those expenses directly to a client's invoice for reimbursement. However, if you need double-entry accounting reports or have more than 5 active clients, you must upgrade to the Plus plan ($43/mo ongoing) or Premium plan ($70/mo ongoing).

How QuickBooks Solopreneur Handles Side Hustle Bookkeeping

QuickBooks Solopreneur replaced QuickBooks Self-Employed to serve one-person businesses that do not need full double-entry accounting or payroll. It focuses on converting daily bank transactions into organized Schedule C categories for Federal tax reporting.

QuickBooks Solopreneur costs $20 per month as of October 6, 2026. Intuit occasionally runs a promotional rate of $10 per month for the first 3 months, but $20 per month is the ongoing regular price.

The primary advantage of QuickBooks Solopreneur is its tight integration with the Intuit tax ecosystem. As bank transactions flow into the feed, you can swipe to categorize them as business or personal, or assign them directly to IRS Schedule C lines (such as advertising, office expense, or travel). At year-end, these categorized totals export directly into TurboTax. It also includes automatic mileage tracking using your mobile phone's GPS.

The limitation of QuickBooks Solopreneur is its rigidity. It does not support complex double-entry accounting, inventory tracking, or migration to higher-tier QuickBooks Online plans without re-entering data or starting fresh. If you plan to hire employees or turn your side hustle into a multi-member entity soon, QuickBooks Solopreneur may be too limited.

Top Alternatives for Freelancer Expense Tracking

If neither FreshBooks nor QuickBooks Solopreneur quite matches your side hustle requirements, several alternative tools offer bookkeeping features tailored to solo operators. Listed alphabetically, these are top options to consider:

FreshBooks

As outlined above, FreshBooks costs $23 per month for the Lite tier, $43 per month for Plus, and $70 per month for Premium as of October 6, 2026. It remains best suited for freelancers whose revenue depends on professional client invoicing and time-tracking features.

QuickBooks Solopreneur

QuickBooks Solopreneur costs $20 per month as of October 6, 2026. It is best for sole proprietors who want straightforward income and expense sorting that links cleanly with TurboTax for annual tax filings.

Wave

Wave offers a Starter plan that is free, making it an attractive baseline for new side hustles testing out software. Wave Pro costs $19 per month (or $190 per year), with a promotional rate of $9.50 per month for 3 months as of October 6, 2026. Online credit card processing costs 2.9% plus $0.60 per transaction, an optional mobile receipt capture add-on is $8 per month, and full payroll features start at $25 per month. Wave provides free bank connection and simple income and expense tracking without a monthly fee on its base plan.

Xero

Xero provides full double-entry accounting even on its smallest plan. As of October 6, 2026, the Early tier costs $27 per month, Growing costs $59 per month, and Established costs $97 per month. Xero running a promotional rate of 80% off for 3 months is common, but $27 per month is the ongoing minimum. The Early plan limits you to sending 20 invoices per month, making it ideal for low-volume, high-value freelancers who want traditional accounting reports.

ZenBusiness Money Pro

ZenBusiness offers ZenBusiness Money Pro at $30 per month as of October 6, 2026. Unlike pure self-service software platforms, ZenBusiness combines business formation services, compliance, and ongoing accounting support in a single ecosystem. Money Pro includes custom invoicing, income and expense tracking, and tax preparation tools bundled together for business owners who prefer managing entity creation and financial operations with one provider.

Official Recordkeeping Requirements You Must Follow

Regardless of whether you choose FreshBooks, QuickBooks Solopreneur, or a basic spreadsheet, the software does not change your underlying legal obligations to maintain records. Federal and state agencies dictate what documentation you must retain and for how long.

According to IRS guidelines on record retention, small business owners must keep tax records based on specific timelines:

• General rule: Keep records for 3 years from the date you filed your original return.
• Substantial omission: Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return.
• Bad debt / worthless securities: Keep records for 7 years if you file a claim for a loss from worthless securities or a bad debt deduction.
• Unfiled or fraudulent returns: Keep records indefinitely if you do not file a return, or if you file a fraudulent return.

If your side hustle grows to include employees, additional employment recordkeeping rules take effect:

• Employment tax records: The IRS requires you to keep all employment tax records for at least 4 years after the date the tax becomes due or is paid, whichever is later.
• FLSA payroll records: The U.S. Department of Labor Fact Sheet #21 states that employers must preserve payroll records, collective bargaining agreements, sales, and purchase records for at least 3 years.
• FLSA supporting records: The Department of Labor requires keeping basic supporting records like time cards, work schedules, wage rate tables, and records of additions to or deductions from wages for at least 2 years.

State sales tax authorities also enforce record retention. For example, California Department of Tax and Fee Administration (CDTFA) Publication 116 states that taxpayers must retain California sales and use tax records for at least 4 years. If you are under an audit, you must retain all records covering the audit period until the audit is complete.

What Documentation Do You Need to Keep?

Software logs transaction amounts, but you must retain the underlying supporting documents to prove those transactions in an audit. IRS Publication 583 identifies specific supporting documents that small business owners should retain:

1. Gross receipts: Cash register tapes, bank deposit slips, receipt books, invoices, and credit card charge slips.
2. Purchases and inventory: Canceled checks, cash register tape receipts, credit card sales slips, and invoices showing what was bought.
3. Expenses: Canceled checks, cash register tapes, account statements, credit card sales slips, and vendor invoices.
4. Assets: Purchase and sales invoices, real estate closing statements, and canceled checks showing the basis of property.

Most digital bookkeeping tools, including FreshBooks and QuickBooks Solopreneur, allow you to attach digital images of receipts directly to transactions. Storing clear digital copies of these supporting documents satisfies IRS requirement guidelines as long as they are legible and easily accessible.

Sources

• Internal Revenue Service, "How Long Should I Keep Records?"
• Internal Revenue Service, "Recordkeeping"
• Internal Revenue Service, "Publication 583, Starting a Business and Keeping Records"
• U.S. Department of Labor, "Fact Sheet #21: Recordkeeping Requirements under the Fair Labor Standards Act (FLSA)"
• California Department of Tax and Fee Administration, "Publication 116, Retaining Records"
• U.S. Small Business Administration, "Manage Your Business"