![]() What you likely really have is: All the people that work for Company A also are employees of Company B I assign them to who they are working for and run the two businesses Separately and appropriately to these relationships. None of this is right it's not right for any of the accounting. And now you want the One to pay the Other, but you are not a Contract Labor organization providing workers, such as a Temp Placement agency. If you have QuickBooks Desktop Payroll, you can create a taxable reimbursement item, see Add fringe benefits to paychecks. I have another entity that benefits from Labor but never Hired these people, and they also are not independent subcontractors I simply borrow them from my own other company, and that other company has the Employee and Payroll relationship and fiduciary responsibilities and employment-related issues. For guidelines on reimbursements, check the Employee business expense reimbursements section of IRS Publication 15, Circular E Employers Tax Guide. That's your "lending" entity, so the Taxes and Business reporting is wrong for this entity = labor costs are Overstated against its own Sales. ![]() Here's what you described: I've got one entity absorbing costs for the Sales that are not theirs from the benefit of this labor. You need to meet with your own CPA, before you get audited by the Feds, your State, your general insurer, and Worker Comp. What you described is called Worker Misclassification. It is Not Payroll Expense, if these people are not employed by the entity. On the P&L, income is reduced by expense, so the added payroll payback income will be offset by a portion of payroll expense.Īctual expense that affect net profit and loss is 13K Use that item on an invoice to the other company. For this, the employee should maintain all. Yes it is income, create a service item for that linked to the income of your choice (I would create one called something like payroll payback). When employees incur work-related travel expenses, it is the responsibility of the employer to reimburse them. at least once per quarter) should accumulate their expenses until the sum of the amount. So you want to have some portion of payroll expense, paid for by the other company. Employees who submit reimbursement requests on a regular basis (i.e. Employee compensation: Salaries, wages, paid time off (PTO), and other taxable income reported on a Form W-2 at the end of the year. I already have my due/to liability accounts for shared expenses and inter-company loans. What is payroll accounting Payroll accounting keeps track of five essential payroll-related costs and obligations. How do I record this payment to company A? I was thinking on invoicing the other company but then it will show as revenue and I'm not sure if it is really a revenue for company A. I want company B to start paying back company A for this labor. Most of the time I have to use the employees from company A to help company B. Own two companies (LLC) with separate books.
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