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Contract Labor

Forum|Forum|3 years ago
August 17, 2022
3 replies
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I use the self employed version. I own a bridal beauty team and they do hair and makeup for weddings on my behalf. I have been categorizing their payouts as contract labor. (the are no employees, just freelancers) But also when a contractor comes to my salon to do work for me (ac/electrical, plumbing etc) I categorize that as contract labor as well. Is this correct? I feel like the freelancers payments should be categorized differently but I haven't found an option that seems right.

QuickBooks Self-Employed

Best answer by Rainflurry

@rdaletto

Your freelancers are contract labor. When you hire an electrician to fix something, that is not contract labor, that is a repair expense. Contract labor is used in lieu of payroll for paying independent contractors that are working for your business under a contract, not as an employee.

C

Candice14

Level 8

Hey there, @rdaletto.

It's great to see you back in the Community. I'd be more than happy to share insight on particular categorizes in QuickBooks Self-Employed.

You can categorize the following types of transactions as contract labor:

Fees paid for:

Create resources
Outside research and data collection
Additional project support
Subcontractors and independent contractors

Learn more about this category and more through this link.

If you still need assistance after looking over these details, just let me know. I'm only a post away if you need me. Have a great day!

R

rdalettoAuthor

Hi, thank you for your response but Im still confused. Both of the people I need help with are considered independent contractors however, one is working for my business under my name and insurance. The other is doing a service for me that Ive hired under their own business and insurance. Is there no difference then for categorization of these two?

Z

ZackE_

Moderator

Good morning,

My bookkeeper is classifying my payments to my subcontractors as cost of goods sold - subcontractor expenses vs contract labor. I think it is throwing off all of my profit and losses in my opinion. Shouldn't all payments to subs be under contract labor and not cost of goods sold?

Thanks for becoming part of the Community, PatriotHomeWorks.

To properly identify if how your subcontractor payments should be classified, 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 an Accountant. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

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Go to our Find a ProAdvisor page.
Use the City or ZIP search field to specify a location.
Select Find a ProAdvisor.
Browse through your results and find one that works best for the business. You can click on each ProAdvisor's profile to learn more information about them.

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