1099 subcontractors

We are a service based business. We dont have “employees”. We hire subcontractors. I need to be able to track who they are, how many jobs they do for me and how much I pay them. I have some that work jobs for me every week and some who only pick up jobs a few times a month. How do I add them and keep track of them?

Does any version of this software proses 1099’s? I REALLY want to get away from Quickbooks but 1099 is a must.

Typically you would add all your sub-contractors as suppliers under Suppliers tab.

When your subcontractor gives you an invoice, you record it under Purchase Invoices tab.

When you pay subcontractor, you match the payment against subcontractor accounts payable account.

Basically you treat subcontractors as any other supplier who is providing their products or services to you on credit.

See: Guides | Manager

As far as I know, in Quickbooks, you would set up subcontractors as vendors and mark them subject to 1099. Then Quickbooks would let you print 1099 reports for each transaction. Manager doesn’t do it yet but if there is enough interest, it’s not difficult to implement. If you have smaller number of transactions, just going through purchase invoices of suppliers subject to 1099 can give you information needed to complete 1099 manually.

If you were looking for more interest, here it is. I too use a large number of"contact laborers " and quick books is the only easy way to print a 1099m. It would be great to add the ability to monitor them as employees and print a 1099 at the end of the year. Most people I work with use their ssn as their business I’d and don’t have a business entity to invoice.

Whether someone has established a separate business identity make no difference to the Internal Revenue Service, @Chris_Pitts. If they aren’t an employee, they are an independent contractor and will have to file Schedule C. And you, of course, will have to report various types of payments to them on a Form 1099 MISC. (This discussion obviously applies only to the U. S.) Treating them as employees is a very poor idea, as the IRS is always looking for companies that abuse the rules and misclassify employees as subcontractors to avoid paying their share of payroll taxes. Every year or two you hear of a big case. Treating them as employees in Manager would undermine any argument you might have with the IRS. Treating them explicitly as suppliers would be evidence in your favor.

One factor to consider in requesting that Manager incorporate the ability to generate 1099’s is that they change slightly from year to year. They always change the pre-printed year, but various boxes can also change. And over time, the rules for how to classify payments (into which box) have been altered. You might ask yourself whether you want a software company in Australia to be responsible for generating forms on which the IRS does 100% matching and has implemented automatic penalties for errors.

1 Like

I was just trying to be helpful and add to the conversation. I didn’t look at the dates.

Promoting other software violate the rules of the forum and terms of service. See FAQ - Manager Forum.