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Thank you... I have independent contractors work for me and…

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Hi and thank you.....

Hi and thank you... I have independent contractors work for me and I reported via 1099 forms the exact amount they earned for the year. Question: final invoices for Dec 2017 were not paid until January 2018 though I still included it in the 2017 total earnings.... was that correct?

Submitted: 3 months ago.Category: Tax
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3/21/2018
Tax Professional: Tax.appeal.168, Tax Accountant replied 3 months ago
Tax.appeal.168
Tax.appeal.168, Tax Accountant
Category: Tax
Satisfied Customers: 4,750
Experience: 3+ decades of varied tax industry exp. Tax Biz owner
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Hello. Thank you for choosing this Q&A service for assistance. My name is***** will be assisting you. I am prepping my response, which I will provide to you in the next thread(s).

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Tax Professional: Tax.appeal.168, Tax Accountant replied 3 months ago

When you record the earnings depends on if you use the cash basis or accrual basis of accounting. If you use the cash basis method, you would record income and expenses when earned or incurred. SEE BELOW:

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    Cash basis. Revenue is recorded when cash is received from customers, and expenses are recorded when cash is paid to suppliers and employees.Accrual basis. Revenue is recorded when earned and expenses are recorded when consumed.
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Tax Professional: Tax.appeal.168, Tax Accountant replied 3 months ago

REFERENCE SOURCE:

https://www.accountingtools.com/articles/cash-basis-vs-accrual-basis-accounting.html

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Customer reply replied 3 months ago
I did my 1099's correctly based on my method?
Customer reply replied 3 months ago
this exchange was $41?
Customer reply replied 3 months ago
no stars yet
Tax Professional: Tax.appeal.168, Tax Accountant replied 3 months ago

If you use the cash basis method, yes, you did it correctly.

I don;t know what you are being billed, but based on the value of the question to me, it appears that $41 is correct.

Please take the time to positively rate my response 3 or more stars so that I can receive credit for assisting you today. A 5 star rating is greatly appreciated. Thank you in advance.

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