What software should a small practice run its money on?
Three pieces. A practice management platform for scheduling and client payments, QuickBooks Online for the books, and a business bank account underneath both. That covers almost every solo and small group practice I work with, and I would rather you run three tools well than seven tools halfway.
The practice management side is whatever you already use. SimplePractice, TherapyNotes, TheraNest, Jane, or something built for ABA or medication management. I do not push people to switch. If it holds your calendar, your documentation, and your client payments, and you are comfortable moving around in it, keep it. What matters for the books is that it gives a clear record of what was charged and what was collected.
QuickBooks Online is where the money actually gets accounted for. Your practice management platform knows what clients owe and what they paid. It does not know about your rent, your liability insurance, your software subscriptions, your mileage, or the money you take out for yourself, and it is not going to hand your tax preparer a clean profit and loss in January. QuickBooks Online will.
Under both of those, keep a business checking account and a business card used only for the practice. It is the least interesting part of the stack and the one that prevents the most cleanup work later.
The spot where this usually breaks is between the payment processor and the bank. A client pays you in the platform. The processor groups several payments together, keeps its fee, and drops one lump sum in your account a day or two later. Your bank feed sees only the lump sum. Somebody has to match that deposit back to the sessions behind it and record the processing fee as an expense. When nobody does, revenue looks smaller than it is and the fees vanish from your numbers entirely. Bookkeeping for therapists goes a lot smoother when that handoff is set up right from the start.
Add a fourth piece only when you truly need one. If you have W-2 staff, you need a payroll system, and I run payroll for practices whose system is already in place. If you pay contract clinicians or supervisors, collect their W-9s the day they start so 1099 season is quiet.
The brand matters less than the setup. QuickBooks Online arrives with a generic chart of accounts written for nobody in particular, and a practice needs categories that match how it really spends, things like continuing education, licensure and board fees, supervision, EHR subscriptions, and office or telehealth costs. I am a QuickBooks ProAdvisor, Level 2 with the Gold Badge, and my QuickBooks Online setup and training gets the file built correctly the first time so it is not something you have to fix a year from now.
If you are choosing software for a new practice, or you have a QuickBooks file you have never quite trusted, book a consultation with me and we will look at what you have and figure out what you actually need.
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Tell me where your books stand right now, even if the honest answer is that nobody has looked at them in a year. I'll ask a few questions and give you a clear idea of how I can help.
More Questions
What is a healthy overhead percentage for a practice?
Common guidance puts overhead under roughly 32 percent of revenue for a lean solo practice, with group practices running higher. Treat that as a starting reference to verify, since the number that actually helps you is your own, tracked month after month.
Read answerI'm leaving agency work to start a private practice. What financial setup do I actually need?
You need less than you think. A business bank account, a QuickBooks file set up for a practice instead of a generic business, a simple monthly rhythm starting your first month, and records your tax preparer will want at year end.
Read answerI offer sliding scale to a good share of my caseload. What should my books show me about it?
Your books should show your effective rate per session, the gap between your posted fee and what you actually collect, and how much of your weekly caseload sits at a reduced rate. Those three numbers tell you what sliding scale really costs and how much of it your practice can carry.
Read answerWhy does it matter that my bookkeeper knows mental health?
It saves you from explaining your own practice before you can ask a question, and it keeps your books categorized in the language of a practice rather than a generic business. After more than 15 years as a nurse in mental health, the learning curve happened long before my first bookkeeping client.
Read answerWhat does monthly bookkeeping actually do for a private practice?
Monthly bookkeeping keeps your books current, keeps your financials tax-ready, and gives you a clear view of how the practice is doing. Each month transactions get categorized, accounts get reconciled to the bank, and you get a short set of reports you can read between sessions.
Read answerWhat's the difference between profit and the cash in my account?
Profit measures what your practice earned and spent over a period of time. Your bank balance shows what is sitting there at one moment, after payment lags, big annual bills, tax set-asides, and owner draws. Both numbers are true, and they answer different questions.
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