Reimbursing Vendor Expenses

2rsdigital · ‎December 22, 2022

This question is driving me mad as I cannot find an answer anywhere on the internet and I don't understand why- How do I properly enter expenses that my vendor is asking for reimbursement for?

I have vendors I pay to do jobs in which the bill they send me is broken out by labor and mileage reimbursement as well as Equipment rental Reimbursement. When I enter the bill, I separate out the charges to the various accounts, just as the bill is broken down. 1099 Contract labor and mileage expense or equip rental expense account.

I separate so that at year end I can easily see how much money I've spent in these various areas- but my Equip rental account is both internal company expenses AND used as the account for the reimbursed expense from my vendor.

Am I entering this correctly or should I be listing the full bill under the single account of 1099 Contract Labor? I ran a test report for 1099 and it looks like all expense accounts are included in the 1099 calculations, but I'm concerned that my 1099 year end reporting totals will not match to my Profit and Loss report under the 1099 Labor account because I've separated these reimbursements into my designated expense account "Equip rental" which is a separate expense account, not a sub account of 1099 Contract Labor.

I previously found an article here about this that looked like double entry was required, once in my expenses account and another against the vendor bill, but now I can't find it.

I cannot find any answer to this question online! Every answer is for receiving a reimbursement FROM a vendor rather than entering a reimbursement TO a vendor inside their bill.

What am i doing right and what am I doing wrong???

This is how my chart of account looks:

1099 Contract Labor (expense)

Mileage (Expense)

Equip Rental (Expense)

Should it look like this? where my internal expenses are separated out from the reimbursed expenses? This doesn't seem necessary/right....

1099 Contract labor (expense)

subaccount: Mileage

subaccount: Equip rental

Mileage (Expense)

Equip Rental (Expense)

Rea_M · ‎December 22, 2022

Hello there, @2rsdigital. Thanks for the complete details you've provided above.

I'll make sure you can use the appropriate expense account when recording your reimbursement to a vendor inside their bill in QuickBooks Desktop (QBDT).

Let's start with how you can determine whether you need to record your vendor reimbursement separately using the Equip Rental account (used both for internal company and vendor reimbursement) or list the full bill under the single account of 1099 Contract Labor. To do this, I encourage you to consult with your accountant. They can provide expert advice tailored to your business needs and keep your financial data accurate.

Commonly, the vendor sends refunds to their customers. But, on your end, it's the other way around. To do this inside a vendor's bill, utilize the Expenses tab, and select the appropriate expense account. Please see the screenshot below for your reference.

You can also refer to this article for the complete guide on how to record or enter a bill in QBDT: Enter bills in QuickBooks Desktop.

Once you're ready to pay your bills, please see this article for the step-by-step guide: Pay bills in QuickBooks Desktop.

Also, you may want to check out these articles as your reference whenever you're set to create and file 1099s in QBDT:

Please feel free to leave a comment below if you have other 1099 concerns or questions about managing expenses and vendor transactions in QBDT. I'm always ready to help. Take care, and I wish you continued success, @2rsdigital.

Topics

Training

Community

Resources

Reimbursing Vendor Expenses

Reimbursing Vendor Expenses

Need to get in touch?