invoicing – Incline Business Essentials

This is the time of year that we start preparing for 1099s and Insurance Audits.1099s must be issued in January for all appropriate subcontractors. Insurance Audits apply only to those of you whose insurance companies require the annual audit. You know who you are!

Our Incline Team will be working together to facilitate this process. You may be hearing from an unfamiliar team member. Please know that this is our team collaborating and assisting one another to efficiently handle this process.

Subcontractors and 1099s

As a business, you are required to issue 1099s to any individual OR unincorporated business that you pay more than $600 for a service within the fiscal year. For example, if you pay someone $800 to install shelving in your office, you must issue a 1099 to that individual. If you pay a web design company $3000 to update your website, you must issue a 1099 to that company if they are not a corporation. If you pay rent over $600 each year, you must issue a 1099 to your landlord. There are additional nuances but you get the picture. We will be running vendor reports to determine who needs to be issued a 1099 and will be helping to collect the required W9 from the individual or company. This means we will be contacting your vendors on your behalf.

Subcontractors and Insurance Audits

Depending on your industry, you may have an annual insurance audit. Typically, this is your insurance company wanting proof that your subcontractors have their own insurance. This is very common in the construction industry although we are seeing this branch out into a variety of industries. We will determine who should be providing proof of insurance and will reach out to collect the insurance certificates. When you audit year cycles, will complete the audit paperwork on your behalf.

Through all of these processes, we do our best to handle as much as possible ourselves. That being said, we may need contact information from your vendors. We may need clarification about exactly what you are paying the vendors for. We may have a vendor who is not completing the necessary paperwork and will contact you to step in.

We are starting this process now so that we will be prepared for the January deadline and for insurance audit deadlines. Just know that we are working behind the scenes to ensure that all necessary paperwork is collected to comply with these requirements.

You can hire us to set-up and manage this process of invoicing and receivables. This will keep you from having to chase down payments and allow you to focus on what you do best – servicing your customer.

If you use a robust software system like QuickBooks Online, invoicing can be integrated and streamlined as a simple system within your business.

In our experience, there are some simple processes that make cash flow management easiest:

Enter the complete contact info for your prospect immediately into your software, including full name, company name, email address and phone number.
Send an estimate within an hour of your meeting or discussion for your proposed services.
Convert the estimate to an invoice once accepted and send immediately with a professional, kind note.
When possible, require payment for services before you begin project. If not possible due to your industry, request half-down and the rest upon completion.
Accept all forms of payment.
Review your receivables list weekly for cash-flow projections.
Use the system messaging/notification function to remind clients of over-due payments.
Use alternate professional methods to reach out as reminders, such as sending an email sharing valuable resources or making a quick phone call to check in and catch up professionally.

Invoicing and collecting receivables should be an integral and fluid system for your business. Let us help you remove the headache and angst of invoicing and collections, which will allow you to maintain a professional posture and long-term relationship with your clients.

Tag: invoicing

Subcontractor Compliance and 1099s

Like this:

Best Practices for Invoicing

Like this: