Labor or 1099 costs on an Invoice

Thank you for sharing your concerns, Jim. I want to share some insights that'll empower you to ensure that labor costs are accurately reflected in your QuickBooks Desktop (QBDT) for Mac.

In QBDT Mac, invoices for services and parts billed to customers won't reflect as costs in your transactions. However, labor costs will only appear if you directly pay your 1099 employee.

To have Bob's costs show up on the Job Profitability report, you have to set up an expense account for him in QuickBooks Desktop for Mac.

Once the account is set up already, you can create a bill for Bob's hours.

Moreover, when creating an invoice for your customer, you can add Bob's hours as an item. These steps should result in Bob's costs showing up on the Job Profitability report.

Additionally, you can create a bill for Bob's costs and then pay him separately. It doesn't have to be part of the estimate/job/invoice creation. This means entering a bill for their services and then making a payment to ensure these costs are properly reflected in your financial records.

Furthermore, you can turn an estimate into an invoice in QuickBooks Desktop for Mac. This feature saves time and effort by eliminating the need to create a separate invoice manually.

I'm here to help streamline your payroll processes and ensure everything runs smoothly. A seamless transaction experience is vital for your success, and I'm committed to supporting you in overcoming any challenges to enhance your workflow.

Thanks Sherrie. Perhaps you could provide more detail?

In QBDT Mac, invoices for services and parts billed to customers won't reflect as costs in your transactions. However, labor costs will only appear if you directly pay your 1099 employee. I don't understand this. Let me try to explain it. In my situation, I sell parts to the customer in the invoice out of inventory. I do see these costs in the job profitability report. But in detail, how do I get the labor costs reflected in the job? I currently use an Item labeled Bob - Technician and I charge $150 an hour. If Bob is a 1099 employee, are you saying that I just create a bill for Bob's time, and make sure it is billed to the current job? I think I'll see the service revenue as cost-free, and then an unbilled cost reflecting Bob's 1099 time? I shouldn't enter hours, right?

Thanks for getting back with the Community, Jim62. I appreciate your detailed information.

When assigning time or costs to jobs, you can track actual costs and time that go into projects. You'll want to be sure you don't forget to assign expenses and employee time to jobs you set up. Also make sure to pick an appropriate job in your Customer:Job column when entering bills, checks, credit card charges, or timesheets.

For job-related purchases (items purchased for a job, subcontractor services), use a bill, check, or credit card charge to record the purchase. On your Items tab, enter each item or service you purchased, and in the Customer:Job field, assign each item or service to the job you're doing for your customer.

When working with Other expenses (freight charges, postage, etc.), use a bill, check, or credit card charge. On the Expenses screen, enter each expense. In your Customer:Job column, be sure to assign each expense to the appropriate job.

If you're unsure of what to enter or choose, I'd recommend working with an accounting professional. If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

I've also included a detailed resource about working with job costs which may come in handy moving forward: Track job costs & profitability

Please don't hesitate to send a reply if there's any additional questions. Have an awesome day!

Mitch, your suggestion was very helpful. Everything seems to work, and when I run a report on Job Profitability Detail for this customer, I see the $50 charge to "Act. Cost" for Bob's one hour of subcontracted work.

On this subject, I do have a MINOR clarifying question: why does this cost show up under "Other Charges: No Item"? The section "Service" shows the "Act. Revenue" line for Bob at $150. But no cost associated with this line. 

I followed your advice, and under "Items" (general list of everything), I have Bob's service line item listed as a subcontractor with the $50 cost and the $150 sale price. So I was hoping that I'd see the subcontracted cost on the same line as the revenue.

Thanks again for your solution to my original problem! If anyone has anything to add, let's keep this useful thread going.

Jim