How can I tell an other cost from a subcontractor?
If you file a 1099 form for the person or company, enter them as a Subcontractor account. If you must track their use of worker’s comp or liability insurance, enter them as a Subcontractor account. If they bill you on an hourly basis, enter them as a Subcontractor account. If you pay them for payroll taxes or sales tax that you have collected, enter them as an Other Cost account. Otherwise it really doesn’t make a difference.
