How do I pay contractors expenses without it being shown on the 1099 and they would be required to pay taxes. I need to pay expenses for their travel, supplies,etc

That is not how it works

the contractor is in business, as a result he has expenses, travel, materials, etc etc

he bills you for them, you pay it, the full amount is reported on the 1099 if you pay by cash or check

On his P&L his income is reduced by his expenses

Hello there, redmondandgreer.

Paying your contractors expenses that will not be shown on the 1099 form is possible in QuickBooks Online. In this scenario, you'll want to create an Expense then in the Payment account field is your credit card account.

You'll use a credit card since it is not included in the 1099 report. Make sure that the contractor is eligible for 1099.

Feel free to reach out to me if there's anything that I can help. Have a good day!

How do I enter the invoice in the QB? Can I enter the whole invoice in one line? The professional fees and the T&E together or do I have/should enter the amount for professional services in one line and the T&E total in another line under expense account ?

e.g  invoice total $9,000  ( $8,000 professional services and $1,000 Air Fare and Hotel)

Consulting Services - $8,000 Class Sales

Consulting Services - $1,000 Class Sales

or

Consulting Services - $8,000 Class Sales

Travel Expense - $1,000 Class Sales

thank you

Marsy

Hello@marsy,

You can create an expense/check or bill and enter every expense as a single line item.

1. Go to the Plus icon.
2. Under Vendor, select Expense, Check, or Bill.
3. Select a vendor for your transaction.
4. On the CATEGORY column, select your expense account.
5. Enter the amount.
6. Click Save and close.

Here's a couple of articles for your reference:

• Enter, edit, or delete expenses in QuickBooks Online
• How to enter and pay bills?

I've got you this article in case you need some ideas about how you can create a billable expense: Enter billable expenses.

Should you need any additional assistance while managing your vendor transactions, @marsy, you can leave a comment below. I'll be sure to get back to you.

Create a second Vendor account for reimbursements only and do not check the 1099 box but be careful to identify it whereas you do not post any of the subcontractor labor through that Vendor account.  This allows you to have the correct expenses for your jobs and alleviates the Contractor from having to report the income and the expense on their side.  Ask your CPA before doing it this way to assure you are in compliance with current regulations as I am not a tax advisor but have done that when working for a CPA in the past.