how do i record payments made to my 1099 subcontractors? If I pay them straight from my bank account, do I create a new group call sub contractors under less: expenses? or do i add a new account call sub contractors ?
Set each contractor up as a Supplier. Also create an expense account in your Chart of Accounts called something like
When the contractor invoices you for services rendered, create a new Purchase Invoice, specifying the contractor in the
Supplier field, and the above-mentioned
Contract Labor account in the
Account field. Then, when the purchase invoice displays, click
Spend Money button and pay the contractor from your bank account, leaving the payment assigned to the
Accounts payable account as per the default (or pay it later by clicking the payables hyperlink in the Suppliers table). You can print the “PAID IN FULL” invoice as a paystub, if you want.
At the end of the year, you can run a Supplier Statement report for each contractor/supplier to see how much you paid them through the year, so you can (manually) create your Forms 1099. Alternatively, you can view the transactions table for the
Contract labor account (get there by clicking the hyperlink in your P/L statement) and then export that table into Excel for munching and crunching as you see fit.