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Posted by Allan Martin on January 31, 2008, 11:10 am
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>
>>
>>>> Hi,
>>>>
>>>> One of my electrical subcontractors (ABC Electric) needed their check
>>>> in the form of a cashier's check, which cost $10. So, on the QB check I
>>>> made it payable to ABC Electric, with an item for $1,000 Electrical,
>>>> and then a second and third item for -$10 (negative) and $10 for an
>>>> item I created, called "Finance Charges".
>>>>
>>>> That way, the $1,000 still gets tracked to Electrical, and I have a
>>>> charge/credit for the $10 cashier check fee.
>>>>
>>>> Methinks there might be a better way (i.e., correct way) to do it?
>>>>
>>>> Also, I think I only want to report $990 on their 1099, but given the
>>>> method above, QB generates $1,000 for that vendor...any ideas?
>>>>
>>>> Thanks!
>>>
>>> You paid the subcontractor $1000. That's what goes on the 1099. You paid
>>> $10 to the bank to receive the cashier's check. That's just an ordinary
>>> business expense. Post it separately using the bank as the vendor name.
>>> It should not be recorded with the subcontractor's name on the
>>> transaction.
>>
>> If there is one thing I learned in practice is never assume. Telling the
>> OP "You paid the subcontractor $1000." does not make it so.
>
> Valid point. I originally was going to write..."assuming you paid the
> subcontractor" but left out the word "assuming".
>
> My point is what ever was paid in total to the subcontractor is what goes
> on the 1099. It is irrelevant that it cost $10 for the certified check.
> That does NOT reduce the amount paid or shown on the 1099.
I agree with you.
>
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