This is a BIG one!
The business owner pays a subcontractor from a personal cash app. Then doesn’t tell me about it!
Personal Venmo and PayPal accounts can really trip up business owners!
The subcontractor needs to be paid and the easy route is to pay with a cash app that probably pays from their personal account.
The sub is paid off the books and the transaction won’t pull for their 1099 total. It also messes up business reports because the subcontractor expense isn’t there.
My two cents? Don’t pay vendors with anything but business accounts!
IF you do pay subs with an account off the books, make sure your bookkeeper knows about it.
They’ll need to go through some riggamaroll to get it in the books AND pull to a 1099-NEC.
This is so much easier to do on the front end and not after 1099 forms are filed.
Keep your bookkeeper in the know ❤️❤️ it will save you both some time and money!