Solved

Contract Labor

Forum|Forum|3 years ago
August 17, 2022
3 replies
42 views

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?

D

DebSheenD

Level 5

Define Contract Labor vs Subcontractor Expense in Quickbooks please.

Hello there, @majorbuild.

I'm here to share details about Contract labor and Subcontractor expense in QuickBooks Online (QBO).

A vendor is those people or companies that you pay money to, such as a store, utility, landlord, or subcontractor who do work for you. On the other hand, Customers are people who owe you money for products purchased or services rendered. While the Subcontractor expense (not employees) are considered expenses to your company. Your accountant(s) suggestion is the appropriate way to record them in QBO. When you maintain this process, you'll be able to keep your financial data accurate.

For future reference, read through this article: How to set up contractors and track them for 1099s in QuickBooks. It helps you learn about adding and tracking contractor payments in QuickBooks Online.

Feel free to post more questions in the Community. I look forward to answering your next posts.