How to reconcile 1099 to Income if I include a markup on billable expenses
My clients are starting to use Bill.com. I am planning to bill them for the cost of Bill.com plus a markup. I don't want to show the markup on the invoice so I am planning to show a flat fee that includes the actual reimbursable cost plus the markup as one cost to them. My question is what is the best way to account for this on their end to provide me with the most accurate tax reporting. 1. If they record this as part of my fee, I will be getting a 1099 that includes the reimbursable cost as income to me. Which it is not. 2. If they list this all as a software cost, I will be getting a 1099 that does NOT include the markup amount and will be less than my actual income. What is the correct way to handle this for tax purposes on my side?