What Is a Subcontractor in Quickbooks

COGS accounts also report the total underlying costs in your profit and loss reports. In QuickBooks, you create new accounts from the Chart of Accounts (COA) window. You then assign the required inventory items to those accounts so you can track exactly what you have in stock and know exactly how much you`ve spent and earned with it. If you`re paying a subcontractor to work for you, enter the contractor payment in QuickBooks with the item you set up for contract work. Now that your items are set up, you`re ready to pay subcontractors if they work for you. What is the right type of detail for the non-wage cost account such as an electrician or carpenter? In addition, it can be complicated to know whether or not someone should be classified as an independent contractor. Intuit has a tool that can help explain the difference between a 1099 worker and a W-2 worker. If you`re not sure, contact a tax specialist or what we call the source of the truth: the IRS website. From time to time, I have to pay another man to work for me when I`m overloaded. That would be a 1099 situation (it`s a subcontractor, right?), so should I just create an expense account called a “subcontractor” or something similar? The subcontractor is not registered ciS or VAT, so I only have to pay them (without VAT) and they pay their own tax as sole proprietor (subcontractor for my business). . . .