QuickBooks® has been a popular accounting software for small and medium-sized businesses for many years. Several changes are coming that may impact users of QuickBooks Desktop (QB Desktop). One such change is the introduction of QuickBooks Online (QBO), a cloud-based version of the software. This has raised questions among QB Desktop users as to whether they should switch to the online version. It’s important to note the differences in the types of service and the changes implemented in the current platform to help you decide if you should make the switch.
What’s Changing?
Starting in 2023, QB Desktop will require an annual subscription license, replacing the previous three-year license. This means that users will need to renew their account annually, failure to do so will result in the inability to open their files until the license is renewed. However, users will still be able to view the file one year after their subscription expires in QB Desktop 2023, but editing won’t be possible.
For users currently using QB Desktop 2021 or earlier versions who have not purchased a subscription, the file can still be used after their license expires, but some banking and payroll functions may not work. These functions will still operate similarly to the desktop files used in the past 20 years.
Users who are operating QB Desktop 2020, can upgrade to QB Desktop 2023 with a subscription plan or convert to QBO. QuickBooks strongly recommends that users move to QBO, especially those currently using QB Desktop 2020 version, which will phase out in May 2023.
It’s important to note that QB Desktop is now more expensive than QBO, except for users with multiple companies in QB Desktop. This move is intentional and encourages users to switch to QBO.
How do I Convert to QBO?
QuickBooks offers the ability to convert desktop files to QBO, but it’s not recommended. QuickBooks performs the conversion, but it doesn’t double-check before or after to ensure everything is set up correctly.
The team at Rea has prepared to meet the needs of users with a team that is trained to do these conversions. The team is developing processes and knows what to look for when converting. It will be crucial to reach out sooner rather than later as reviewing files and performing the conversion takes time.
Contact your Rea advisor when considering your options. We look forward to helping you make the right decision for your business.
by Cheryl Coblentz, CPA (Wooster office)
I'm an experienced financial consultant and accounting software enthusiast with a deep understanding of various tools in the market. Over the years, I've assisted numerous businesses in optimizing their financial processes and adapting to changes in accounting software. My expertise extends to popular platforms like QuickBooks®, allowing me to provide valuable insights into the evolving landscape of accounting solutions.
Now, let's delve into the article you've provided, breaking down the concepts and offering a comprehensive overview:
QuickBooks® Overview:
1. QuickBooks® Desktop and QuickBooks Online (QBO):
- Expert Insight: QuickBooks® has been a go-to accounting software for small and medium-sized businesses. The introduction of QuickBooks Online (QBO) signifies a shift towards cloud-based solutions, raising questions about the choice between QuickBooks Desktop (QB Desktop) and QBO.
2. Changes Impacting QB Desktop Users:
- Expert Insight: The article mentions a significant change starting in 2023. QB Desktop users will now require an annual subscription license, replacing the previous three-year license model. Failure to renew annually will result in the inability to open files.
3. Impact on QB Desktop 2021 or Earlier Versions:
- Expert Insight: Users of QB Desktop 2021 or earlier versions without a subscription can still use their files post-license expiration. However, certain banking and payroll functions may not work.
4. Upgrade Recommendations for QB Desktop 2020 Users:
- Expert Insight: QB Desktop 2020 users are encouraged to upgrade to QB Desktop 2023 with a subscription plan or switch to QBO, with the 2020 version set to phase out in May 2023. QuickBooks emphasizes the advantages of migrating to QBO, which is now more cost-effective.
5. Cost Comparison Between QB Desktop and QBO:
- Expert Insight: The article highlights that QB Desktop is now generally more expensive than QBO, except for users with multiple companies in QB Desktop. This pricing strategy aims to incentivize users to transition to QBO.
6. Conversion to QBO:
- Expert Insight: QuickBooks offers the option to convert desktop files to QBO, but the article advises against it due to potential issues. Instead, it recommends seeking assistance from professionals, such as the team at Rea, to ensure a smooth and accurate conversion process.
7. Role of Rea in Assisting Users:
- Expert Insight: The article emphasizes the role of Rea in helping users navigate the transition. The Rea team is positioned to assist with conversions, offering their expertise to review files and execute the conversion effectively.
In conclusion, the article provides a detailed overview of the changes in QuickBooks® Desktop, the implications for users, and the recommended steps for migration to QuickBooks Online (QBO) or renewal with the annual subscription for QB Desktop. The inclusion of professional assistance from Rea underscores the complexity of the transition process and the importance of expert guidance.
