PS: Use my refer-a-friend code MORGAN when signing up for Collective to get your first month free (a $297-$349 value).
On December 27, 2024, Bench Accounting suddenly announced they were closing their doors, leaving many small businesses scrambling to figure out their tax prep and bookkeeping needs.
As a solo entrepreneur who hates QuickBooks and doing her own accounting and bookkeeping, I remember looking into Bench’s services years ago. Ultimately, though, I opted for an alternative service that promised a more hands-on, “white glove” experience. At the time, the company was a small startup called Hyke. Today, it’s an industry leader known as Collective.
I’ve been a Collective member for over five years, and I couldn’t be happier—or, in light of Bench’s shutdown, more relieved that I made the right choice.
Get 1 month free with promo code
Get your first month with Collective free (save $297-$349) with promo code MORGAN.
Bench vs. Collective
Bench is known for its online bookkeeping software paired with in-house bookkeepers. Their services include historical and monthly bookkeeping, cash flow and expense tracking, and financial reporting.
Small business owners, rejoice—Collective offers all of those same services, plus extras tailored specifically to solo entrepreneurs, a group they’ve built their reputation serving.
And here’s the good news: they’re now available in all 50 states! (They used to operate in just a handful.)
Here’s what Collective offers:
- Year-round bookkeeping services and accounting services
- Expense tracking
- Invoicing software
- Real-time access to bookkeeping, accounting software, and financial data
- LLC formation
- S-Corp election
- Tax ID Number (EIN)
- Quarterly tax estimates
- Business tax returns (federal and state)
- Payroll
- Financial reporting
- Tax preparation
- Access to a team of tax, accounting, and support pros
PS: You can read my full story about my pre-Collective tax woes in my detailed Collective review here.
What’s an S-Corp Election, and Why Should You Care?
Collective’s big claim to fame is that they save members an average of $10,000 per year by helping them structure their LLCs to take an S-Corp election.
If that sounds complicated—or if you’re thinking, “I don’t want to be an S-Corp; I want to stay an LLC”—don’t worry. You don’t actually become an S-Corp. Instead, if your LLC is set up properly (which Collective helps with), you simply check a box on your tax forms each year. That’s it. And just like that, you start saving on taxes.
How? It’s not a loophole; it’s just a smarter way to handle your income. Rather than paying self-employment tax on 100% of your earnings, you payroll yourself a reasonable salary and pay taxes on it as you go—at a lower rate. The rest of your income is treated as owner distributions.
This setup also lets you contribute to programs like Social Security and even enroll in a Solo 401(k). Essentially, the S-Corp election allows small businesses like mine to operate like larger ones when it comes to payroll and tax filing.
My Typical Month Looks Like With Collective
When I say Collective provides a “white glove” experience, I mean it. My monthly workload is minimal because they handle almost everything for me.
Here’s what my typical month looks like:
- Uploading Bank Statements: I get an email reminder from my Collective Accounting Pro to upload financial statements (like my bank and credit card statements) along with notes for any unusual monthly expenses.
- Recording Reimbursements: I log into the Collective dashboard to fill out a simple reimbursement form for things like office space, insurance, and utilities.
That’s it. The Collective team handles everything else.
Collective recently launched its own accounting software, which not only allows you to manually tweak your own bookkeeping (if desired) but also lets you create, track, and send invoices seamlessly.
Before I joined Collective, these tasks took me hours each month. Now, they take just minutes. My taxes and bookkeeping are always ready on time, and my business saves thousands of dollars every year. Best of all, I’ve reclaimed days of my life, which means more billable hours and more time to focus on growing my business.
If I ever have a question, I just email my dedicated tax pro, and they usually respond within 24 hours. It’s like having a personal virtual accounting office at my disposal year-round.
Get 1 month free with promo code
Get your first month with Collective free (save $297-$349) with promo code MORGAN.
Collective Pricing
As of this writing, Collective costs $297 per month (with an annual plan) or $349 per month (if you go month-to-month). If you use the referral code MORGAN, you’ll get your first month free!
(Note: The referral link isn’t an affiliate link. You have to be a subscribing member to refer others. I’m a paying customer, and this is part of their refer-a-friend program.)
Speaking of which, Collective’s referral program is one of the best I’ve seen—it’s worth its weight in gold for a solo entrepreneur.
All in all, if you’re a freelancer or solo entrepreneur looking for a Bench alternative for your taxes, bookkeeping, and accounting, I highly recommend giving Collective a try.
