I never really looked into this but just now did, and realized it doesn't make sense, how my QB is set up. I run a computer support business, and from time to time I have people who work for me as contractors. When I pay them, I file it as "Labor" expense. But that expense does not show up as a COGS as it should, since it is certainly a direct cost against revenue generated by them. Any advice on how to fix this? Certainly for going forward, but also ideally for past transactions? Changing Labor to a COGS expense, or re-labeling paychecks to the contractor as some other COGS expense. Thanks!
By the way when I go to edit account, for Labor, the Tax Line Mapping seems to be important. Right now it is 1099-MISC, which is how I pay him. It does seem that if it was up in Schedule C-COGS, it would be classified correctly. But, I do pay him with a 1099, so which is correct?