I have a question on paying contractors online. Why is there an $8 fee to pay contractors electronically, but no fee to pay vendors?

Hi JasperContracting,

We only collect a fee if you process a direct deposit payment for contractors. We don't offer this service to vendors. However, you can use a bill pay service that is powered by Melio, our partner app for processing vendor payments.

On the other hand, yes, you're right that only if they get a 1099 form they are contractors. You can refer to this article: Independent Contractor Defined.

Let me know if you have any other concerns. Have a good one!

@JasperContracting 

Open a seperate Melio account for free to manage and pay your 1099 contractors for free and integrate it with QBO.

https://melio.grsm.io/pricing

I can pay all my vendors through draft from my bank account for free.  I don’t understand when you say it is only available for contractors. 

When I pay the vendors through ACH, it uses melio. How can I connect it for vendors? I only see the direct deposit option. 

Click the link I mentioned earlier. A separate Melio account offers more perks than the built-in Melio feature in QBO. 

Hi there, @JasperContracting. I'm here to provide additional information to process payments to your vendors in QuickBooks Online (QBO).

In addition to Fiat Lux suggested above, you'll need to take a few steps in setting up your vendor account to pay them via ACH. To do so, you either need to manually input their bank account information or invite them. Also, this is only available if you've signed up for Online Bill Pay. For more info, feel free to check this article: Learn how to pay a vendor electronically.

Once done, you're now ready to pay them. 

Let me know updates on how this goes. I'd appreciate any details you can add. If you have any other questions about processing payments for your vendor or contractors, please don't hesitate to post again here. I'm always ready to lend a hand. Have a great day ahead.