Seven Best Practices For Contractors
By: Rachel Raupp
When you’re a contractor, you work on multiple projects that need different accounts and we want to make sure the chaos doesn’t turn into confusion. To make sure everything is organized and you know exactly what’s going on in each account, we compiled a list of helpful tips.
- Set up your QuickBooks properly at the beginning. You will need a specialized Chart of Accounts and Items for your business. By doing this right the first time, you avoid the very time consuming task of having to clean up your books.
- Invest the time, money, and energy to set up QuickBooks to properly track Direct and Indirect Constructions Costs and keep Overheard separate.
- Use Estimates to your customers and Purchase Orders to your vendors. Link the two to track your costs by project.
- Assign Job Costing to all expenses.
- Make adjustments each month to recognize Work In Progress (WIP).
- Track your contractors for ease of issuing 1099’s at the beginning of the year.
- If this becomes too much to handle, hire a qualified QuickBooks ProAdvisor. The money you “invest” in this will help you save you time, money, and energy in the long run.