We bill our clients a flat fee for the service and pay a1099 % of that invoice. How do we create an expense for that 1099 off that invoice?
Our invoice are flat fees i.e. $400 for the service and we pay a % of that invoice to the 1099 contractor. We are trying to figure out how to create an expense or bill for that specific income invoice. Is that possible? Also should we setup 1099 contractors as Vendors or Contractors?
Allow me to share some insights about creating an expense for a percentage of the invoice income.
As of this time, we don’t have an option to tally a percentage of the income in creating an expense. In the meantime, you’ll want to manually convert the percentage of income from that invoice in paying your contractor. Let me show you how to pay your contractor in QuickBooks Online (QBO):
Go to the Workers or Payroll menu.
Click the drop-down next to the contractor's name and then click Write check.
Select the expense account you use to track paychecks from the Corresponding account in QuickBooks field.
Enter the needed information, then click Save and Close once done.
Also, a vendor is a person or a business that sells products that is different from a customer. While a contractor is a person assigned to specific tasks that have a set completion date. To learn more about withier you should add them as a vendor or contractor, check out this article for reference: How to set up contractors and track them for 1099s in QuickBooks.
I understand having this option would be a great help for you and other users so they can work seamlessly in QBO. I want you to know your voice matters to us. I’ll let our product engineers know about this feature so they’ll consider adding this in future updates.
For now, I recommend checking our QuickBooks Blog page. There, you’ll be able to get the latest news about QuickBooks and what our product engineers are currently working on.