Project Expenses and Hourly cost rate with QB Payroll

Hi @GregMonty,

The Project Profitability report contains only the itemized view of your project accounts and transactions. Since overhead is made up of many different costs, QuickBooks uses the Time Cost Report to view the hourly time costs separated from other project costs.

Currently, QuickBooks tracks your project labor costs in a two-part process.

• First, calculate the hourly cost rate for each employee.
• Then, add project timesheets using your hourly cost rates.

Rest assured, I'll be sending a product request to our engineers so they can consider this option to be added in the future update.

Please refer to this handy article for details about tracking income, costs, and profitability by project. I'm also adding our blog for your reference. Here's the link: How To Calculate And Track Overhead Costs.

Know that I'm always here if you need help with anything else. Thank you for posting in the Community and more power to your business.

@ShiellaGraceA, thank you very much for confirming my suspicions.  Interestingly enough, this feature works flawlessly if you don't have QB payroll.  I mean to say that if you just integrate TSheets with QBO without payroll, the total project labor cost calculated with Hours X Hourly cost rate (inputted from the project module) is naturally part of the Project profitability report. Exactly the way one would expect it to work.

It is the add on of QB payroll that actually causes the issue because of the need to link the payroll transaction to the cost entry in the project module. 

Like I said, completely irritating to go through all the trouble of adding the overhead burden rate to every employee, only for the rate to be disregarded when calculating profitability.  It is only when you manually calculate that you can get project profitability with Overhead burden rate.

Effectively incentivizing those that are serious about job cost to use a Payroll product other than QB/Intuit Payroll.  Seems very counter intuitive.

@ShiellaGraceA @QuickBooksHelp 

Is there any change in this? It is mind boggling that all this data is right there yet it can't be accessed in a report that is helpful. 

Hi there, @mayfieldsolar.

Currently, the insights provided by my colleague there, @ShiellaGraceA, is the latest function of the Project Profitability report in QuickBooks Online Payroll.

I know it could benefit a lot when we can access the full detail of the Project Profitability report. Likewise, I'm taking note of this one.

In the meantime, I'd suggest visiting our blog site to check for updates and features in QuickBooks.

In case you need articles that start with "How do I" queries, I've added this for your future references: QuickBooks Topics. There you can pick a wide selection of specific points like banking and payroll.

Feel free to connect with us here if you need further assistance. I'll be happy to help. Stay safe and well!

It is now one year later, and Intuit has gone all-in on integration of Tsheets/QBO Payroll/QBO, and yet we can't get overhead simply into the Project overview. It makes me wonder if accountants are in charge of building out the Project functionality.

I just migrated a client who had very smoothly functioning Project Profitability using Tsheets and another payroll provider to QBO payroll at the beginning of 2021. Now our smoothly functioning system is double counting the actual expense. 

I suppose we could go in and add just overhead to the Hourly Cost Rate, and then the Overview would show the calculated "Total Internal Cost" + the Actual cost derived from payroll and payroll tax?

Please bump this up on your developers fix list. For anyone doing serious project accounting with QBO/QBO payroll and Tsheets, this is wildly frustrating. All the numbers are in the database, but they can't be linked by the users.

Hi Stacey.

I can see the importance of this feature for you and your business. Rest assured our engineers are working nonstop to enhance the product and deliver the best experiences for all users. I'll make sure to take note of this message and pass along the information to them. Moreover, you can also submit feedback through your QuickBooks Online (QBO).

Here's how:

1. Open your QBO account, then go to the Gear icon.
2. Click on Feedback.
3. Enter your comments or product suggestions on the Feedback window.
4. Hit Next.

Once done, your valuable feedback goes to our product development team to help improve your experience in QBO. You can track feature requests through the QuickBooks Online Feature Requests website.

For additional resources about tracking project income, expenses, and profitability in QuickBooks, you can review these articles:

• Set up and create projects in QuickBooks Online
• Track income, costs, and profitability by project
• How To Calculate And Track Overhead Costs

You can also open the topics from our help articles for more tips and resources while working with QuickBooks in the future. Here's the link: Find QuickBooks help articles for QBO.

Please let me know how else I can help you with QuickBooks or the project feature. I'm always here to help. Keep safe!

A year later again and I have found my way here because of the same kind of problem. I manually entered Timesheets for 8 employees, tracked all their hours to varying projects (since we don't use TSheets at this time), ensured i had the "Hourly Cost Rate" at the top of the projects overview page set up for every employee and all it did was populate TIME to the job. 

So now, I am manually going into the Project, clicking on the "Hourly Time Cost" section, opening the report for the month and MANUALLY clicking on every single time entry to update the "Cost" to the "Hourly Time Cost". This is absolutely ridiculous.... why on earth does this feature exist within QBO, with a big giant button at the top of the Projects page to set it up, if it won't pull through the cost. 

Billable or not. $0.00 for cost to every single hour of time. I have 500+ costs to adjust for this for ONE month. Yes, I have sent feedback. Just here to update that in 2022 for anyone coming here, you won't find your answer yet. It has not been solved. 

Has this issue been resolved yet?

We are currently having our employee pay be tracked twice to projects - both due to T-Sheets and then due to payroll (through QB payroll) - and it is throwing our project profitability rates totally off. This only changed when we moved folks from salary to hourly.

What is the solution? Can we disable 1 of the 2 costs? (either Hourly Time Cost or COGS - Job Payroll expenses) - so they don't show up in our report?

I've got your back, @PerezConstruction.

Yes, you can remove the hourly time cost from the project so it won't track twice and doesn't show on your profitability report. Here's how:

1. Sign in to your QuickBooks Online (QBO) account.
2. Click Project from the left menu.
3. Select the Hourly cost rate button.
4. Choose the employee you want to remove the hourly cost rate.
5. Click the pencil icon to edit, then enter 0 amount on the field.
6. Select Save, then Done.

You might want to read this article to learn more about tracking hourly costs: Track hourly labor costs and profitability by project in QuickBooks Online.

Just in case you might want to invoice your customers for project expenses, you can check out this article for more guidance: Invoice customers for project expenses.

Please let me know if you need clarification about this, or there's anything else I can do for you. I'll be standing by for your response, @PerezConstruction.

I'm having the same problem. This seems like a fix, but it actually doesn't help when you have already entered an Hourly Cost rate to project. If the amount has already been entered for a specific project, and you change the rate, the new rate will only apply to a new project. I'm not about to go back and manually adjust every time sheet in my project. We need this to be fixed. 

Good day, @natalie2.

Yes, you're right. The steps shared by my colleague Mark_R work if you haven't entered an Hourly Cost rate for a project. 

If you're using this feature, QuickBooks will calculate employees' labor costs using their timesheets that are tracked to your project. Thus, hourly rates will only calculate costs on new timesheets going forward.

For now, you'll have to manually adjust timesheets in your project once you change the rate. 
 

I can see how this option would be helpful for you and your business. Therefore, let me take note of this as a suggestion to improve your QuickBooks experience.
 

You can also send feedback to our developers so they can review it. This will help them improve the product and ensure we meet our customer needs.
 

1. Select the Gear icon at the top and click Feedback.
2. Enter your comments or product suggestions. Then select Next to submit feedback.

It's important that we always meet our customer's needs. While we continue to make improvements, I want you to be updated with the latest QuickBooks news and product release through our Firm of the Future site. This is where we share recent happenings and future developments, such as updates to newly added features.

In case you need related resources while working with QuickBooks, please feel free to skim through the topics from our help articles.
 

If you have any other questions or QuickBooks-related questions, don't hesitate and come back to the Community. I'm always here to help you. Have a great day.