Bookkeeping for consultants, agencies, and service-based businesses
Project revenue recognition, retainer accounting, subcontractor 1099 compliance, unbilled WIP visibility, and S-Corp owner compensation — bookkeeping built for how consulting and agency businesses actually work.
We work with independent consultants, marketing agencies, coaches, and service firms on the bookkeeping issues that matter for service businesses: retainer accounting, project margin visibility, subcontractor pass-throughs, and the S-Corp owner payroll structure that keeps you compliant and tax-efficient.
QuickBooks Online · Gusto · Ramp — professional liability insured — month-to-month, 30-day notice
Pick a time right here — no prep required.
Service businesses run on revenue models most bookkeepers get wrong. Retainers that are liabilities, not income. Unbilled WIP that belongs on the balance sheet. Subcontractor costs that should hit COGS, not overhead. S-Corp payroll that must be structured correctly. We handle every one.
What changes with TurnkeyCFO
Every service below is built for how consulting firms and agencies actually operate — project-based work, recurring retainers, subcontractors, and the ownership structure that drives tax efficiency.
Full monthly close for your consulting firm or agency — accurate categorization of project revenue, retainer income, subcontractor costs, software subscriptions, and overhead. Monthly close package with P&L, balance sheet, and written commentary ready for your review every month.
Retainer payments recorded as deferred revenue and recognized as services are rendered each month. Project-based revenue recognized on milestones or percentage-of-completion as your contracts dictate. Invoices and payments matched to the period the work was performed — so your monthly P&L tells you what you actually earned, not just what clients paid.
Every unincorporated subcontractor paid $600 or more tracked from the first payment. W-9s collected before work begins. 1099-NEC filed by January 31. Subcontractor costs recorded as COGS — not overhead — so your gross margin reflects the real cost of delivering your services. Pass-through billing structured so your revenue, subcontractor costs, and net margin are always visible.
Work you've performed but not yet invoiced is a current asset — unbilled Work-in-Progress — and it belongs on your balance sheet. We track WIP so your balance sheet reflects the true economic state of your business, you can see how long unbilled work takes to convert to cash, and you never lose track of time already invested in a project before invoicing.
S-Corp owner-consultants must pay themselves a reasonable W-2 salary before taking distributions. We set up and maintain owner payroll, document the reasonable compensation decision, and structure distributions separately. The IRS scrutinizes S-Corps that take distributions without payroll — we make sure your setup is documented and defensible. Coordinate with your CPA for the specific compensation level that's right for your situation.
Software and tools are one of consulting's largest expense categories and one of the most commonly miscategorized. Direct project tools (project management, client-specific software, billable tools) tracked separately from general overhead (communication, accounting, admin tools). Home office costs documented to support deductions. Every subscription in its right bucket.
Project-level P&L tracking from proposal to final payment — revenue recognized by project, subcontractor and direct costs allocated to the engagement, and net margin by client visible at a glance. You see which clients, project types, and pricing structures are driving margin and which are quietly losing money after subcontractor costs.
Tax filings and legal matters — coordinated with your CPA or attorney. TurnkeyCFO does not provide tax or legal advice; we keep your books filing-ready and support the process.
The day-to-day realities most bookkeepers have never touched. We have.
Cash received is not income until the work is done.
A monthly retainer paid on the 1st of the month is a liability until you deliver the services. Recording it as income when it hits the bank overstates January revenue and understates your obligation to the client. The correct treatment: deferred revenue on receipt, revenue recognition as services are rendered. This matters for your P&L accuracy, your balance sheet, and your ability to understand which months were genuinely strong.
Revenue timing affects every metric you use to run the business.
Milestone recognition books revenue when specific deliverables are completed — better for projects with discrete phases. Percentage-of-completion recognizes revenue proportionally as work progresses — better for long-term projects where work is continuous. The method matters: a project with $50k milestone payments at 30/60/100 completion looks very different on your P&L than the same project billed monthly by hours. We implement the method that matches your contracts.
Pass-through billing hides your real margin if it's in the wrong account.
If you bill a client $10,000 for a project and pay a subcontractor $6,000 to do half the work, your gross margin is $4,000 — not $10,000. Burying the subcontractor cost in overhead gives you a P&L that looks great until you do the math. We record subcontractor costs as COGS against the project revenue so your gross margin is always visible and accurate. You know exactly what you're keeping after delivering the work.
IRS scrutiny is high. Documentation is everything.
S-Corps avoid payroll tax on distributions — which is why the IRS requires owner-employees to pay themselves a "reasonable" W-2 salary before taking distributions. The reasonable compensation level is based on what you'd pay someone else to do your job. We set up the payroll structure, document the compensation decision, and separate salary from distributions in the books. The documentation is what makes it defensible if you're ever questioned.
Work performed but not invoiced is money owed — not invisible.
If you've delivered 40 hours of consulting at $250/hour but haven't sent the invoice yet, you have $10,000 of unbilled WIP on your balance sheet. Ignoring it understates your assets and makes your balance sheet misleading. We track WIP so you always know what's earned but not yet billed, how it converts to invoices and cash, and whether any WIP is getting stale and at risk of not being billed.
Legitimate deduction — but documentation-dependent.
Home office deductions are available to consultants who use a dedicated space exclusively for business. The deduction covers a proportional share of rent or mortgage interest, utilities, internet, and depreciation. We track these costs in the books in a way that gives your CPA the documentation to claim the deduction on your return — so you get the benefit without the guesswork at tax time.
Simple, fast, and designed not to take you away from client work.
We learn your business — revenue model, client mix, subcontractor usage, entity structure, current software, and pain points. No sales pitch.
We connect to QuickBooks, review your chart of accounts, assess revenue recognition setup, map your project structure, and identify what needs to be restructured before going live.
Monthly close package, project-level P&L, retainer deferred revenue, WIP tracking, and S-Corp payroll structure running clean from month one.
Monthly retainer payments are deferred revenue until services are rendered — not income when the client pays. If a client pays a $5,000 monthly retainer and you haven't done the work yet, that cash is a liability. We record retainers as deferred revenue when collected and recognize income as services are delivered each month.
Subcontractor pass-through billing has two bookkeeping challenges: recording the gross vs. net distinction correctly, and tracking every unincorporated subcontractor paid $600 or more for 1099-NEC filing. We structure the books to show your gross revenue, subcontractor COGS, and true gross margin — and track 1099 obligations from the first payment.
Unbilled WIP is work you've performed but haven't yet invoiced — a current asset on your balance sheet. For consulting firms billing on time-and-materials or milestone basis, this can be significant. We track it as an asset so your balance sheet reflects the true economic state of your business and you can see how quickly unbilled work converts to cash.
S-Corp owner-consultants must pay themselves a reasonable compensation salary before taking distributions. The IRS scrutinizes S-Corps that take distributions without payroll. We set up and maintain W-2 payroll for S-Corp owners, document the reasonable compensation decision, and structure owner distributions separately. Coordinate with your CPA for the specific amount.
Yes. Project-based revenue can be recognized on a milestone basis, percentage-of-completion, or on invoice. We implement the method that matches your contracts and business model, and make sure revenue is recognized in the right period — especially important for multi-month engagements.
Yes — and proper categorization matters. Direct project tools are tracked separately from general overhead so your project margin and overhead are both accurate. Home office costs are documented to support deductions when your CPA prepares your return.
Home office deductions are legitimate for consultants who use a dedicated space exclusively for business. We track home office costs in the books in a way that supports the deduction when your CPA prepares your return. We don't prepare taxes, but we make sure your books give your CPA what they need.
Month-to-month engagement, 30-day notice. No multi-year contracts. We keep clients because the work is good, not because paperwork traps them. Use the Instant Estimate to see a real price range before we ever talk.
Use the estimate above to see a real price range, then book a 15-minute call to talk through fit and scope. No pressure, no sales pitch.