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Lane
Lane , JD, CFP, MBA, CRPS
Category: Finance
Satisfied Customers: 9203
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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Engineering resource company (provides design drawings) is

Resolved Question:

Engineering resource company (provides design drawings) is it considered a subcontractor for a job or a supplier (of engineering design services)?
Submitted: 2 years ago.
Category: Finance
Expert:  Lane replied 2 years ago.

Lane :

For what purpose? For tax, either way is 1099

Lane :

There IS an exception for the need to send a 1099 to the drawing company if it is a corporation

Customer:

Hi Lane. Yes, for tax, as a by-product of this question, but primarily for how to categorize them for job costing breakdown.

Lane :

I would use supplier UNLESS this is a part of the "deal" (and again this is really semantics) but if the grantor of the contract is giving you the contract because of WHICH design company you're using I'd use subcontractor

Lane :

If you can switch at will, they're really more of a supplier

Customer:

Why I'm asking: are they just a supplier (as in a parts purchase) or a subcontractor, and somewhat responsible (as in a fabricator sense). Thanks, XXXXX XXXXX answered that question as I was typing.

Customer:

They are a supplier in this situation.

Lane :

Yep

Lane :

Glad I could help

Customer:

Also, sometimes we use other staffing services, would their cost also be considered supplier/

Lane :

Yes, especially in that scenario, where you are using a service and they are not (necessarily) a part of the job (that particular contract) ... although I would think contract labor would be more descriptive, at leaset as a description

Customer:

Great. Thank you.

Lane and 4 other Finance Specialists are ready to help you
Expert:  Lane replied 2 years ago.

Thanks for the rating Terri,

let me know if I can help further

Lane