BOOKKEEPING FOR CONTRACTORS & TRADES
Bookkeeping for Contractors in Florida: Clean Books, No January Scramble
Materials, labor, and subs kept separate, so you can see your real margin. Equipment depreciated. Loans amortized. Payroll booked right. 1099s tracked all year, not chased in January. Bookkeeping, tax returns, and planning available separately from one firm in Holiday, Florida. We serve contractors across Tampa Bay and work virtual first with the rest.
A quick, no-pressure call to see whether we're the right fit. No prep needed.
Paul Belshaw, MSCTA — in Tax and Accounting since 1978.
From $495/month
Depreciation, loans, and payroll
done right
1099s tracked all year
Bookkeeping, returns, and planning available from one firm
About BATS
Belshaw Accounting Tax and Advisory Services LLC (BATS) is a virtual-first accounting firm in Holiday, Florida. We provide bookkeeping and accounting, individual and business tax preparation, and business advisory for small and growing service businesses, including contractors and trades. Clients choose the services they need. When engaged for both bookkeeping and tax preparation, we can coordinate the books with the return.
Sound familiar?
You don't know where the
money goes
Materials, crew, and subs all land in one bucket on your P&L. When margin slips, you can't tell whether it's the materials, the hours, or the subs.
January is a 1099 scramble
You're chasing W-9s from subs who finished in March.
Two of them don't answer the phone anymore.
You bought equipment and you're not sure what it meant
The truck, the excavator, the trailer. Was it expensed, depreciated, or taken under Section 179? You're not sure which happened, or whether it was right
Cash is tight even in
a good month
Money went out for materials weeks before the draw came in. That gap doesn't show up on your P&L.
My family and I have worked with Paul and Belshaw Accounting for years. They handle our bookkeeping, accounting, and taxes, but what I value just as much is having Paul there when we need advice or have a financial question. He knows our business and our family, and we know we can call when something comes up and get the help we need. It's not just a once-a-year tax relationship. BATS is there throughout the year helping us stay organized, make better decisions, and keep the business moving in the right direction.
2J's LawnCare
Bookkeeping for Contractors: What's Different About the Books
Sorting a bank feed into categories is the easy part. Contractor books need more, and
the difference shows up at tax time.
01
Materials, labor, subs, and equipment kept separate
A standard chart of accounts drops all of it into one cost-of-goods line. Split apart, you can see whether margin is slipping on materials, on crew hours, or on what you pay subs. Those are three different problems with three different fixes. One number can't tell them apart.
02
Subcontractors and 1099s
We track subcontractor payments covered by your engagement from the first recorded payment. You collect the W-9 before the first check, not in January
For qualifying payments made in 2026, the federal 1099-NEC reporting threshold is $2,000, up from $600. A higher threshold doesn't change the work. A missing or incorrect taxpayer ID number can trigger 24% backup withholding when applicable; if backup withholding actually occurs, reporting may be required even below the ordinary dollar threshold. You still need to know what you paid each sub to know who crosses the line. So the W-9 gets collected first, and the tracking runs all year. What changed is the number, not the work.
03
Retainage
Most contracts hold back a percentage until the job is signed off. Ten percent is common, and the wait can be months. On a cash basis, held-back money generally counts as income when it's paid to you, or when it's made available to you with no strings attached. Money the contract still holds back usually doesn't count yet. So a job can be finished and profitable and still not be fully in your numbers. Tracking what's outstanding is your office's job. What we do is record it correctly when it comes in.
04
Reasonable compensation
If you're an S corp, what you pay yourself has to be defensible. Owner draws booked as payroll, or payroll booked as draws, show up in contractor books. It's worth getting right before the return is filed, not after. See how it played out in a contractor S corp election case study.
The Three Things Missing From Most Books
01
Fixed assets and depreciation
The truck, the trailer, the excavator, the computers. Either they're not on the books at all, or they're on there with no depreciation schedule behind them. Either way the balance sheet is incomplete, and the tax treatment may not show up properly in the books. We maintain schedules for the assets covered by your engagement and carry them forward. Auto expenses and trade-ins get handled correctly too.
Section 179 and bonus depreciation can be worth real money. But the largest deduction isn't automatically the best choice. Timing can matter when your income changes from year to year, and Section 179 has its own limits and carryforward rules. That's why equipment purchases are worth discussing before you buy, not while the return is being prepared.
02
Loans, amortized properly
The whole loan payment usually gets coded to one place. But only the interest is an expense. The principal reduces what you owe.
Coded as one lump, three things go wrong at once. Your expenses are overstated. Your profit is understated. And the loan balance on your books doesn't match what the lender says you owe.
A contractor with a truck note, an equipment loan, and a line of credit has three schedules to keep and three journal entries every month. We maintain amortization schedules for the loans covered by your engagement and split principal from interest as applicable. It's tedious. It's also what keeps your books tied to what you actually owe.
03
Payroll, booked correctly
The payroll service drafts one number from your account, and it gets coded to one line. So gross wages and employer payroll taxes don't show up separately on your P&L.
Labor is a major cost in a contracting business. If it shows up as a single draft, you can't see what a crew really costs, and you can't price a job against it.
We book the payroll journal entry every period. Wages, employer taxes, and withholding land where they belong.
None of this is glamorous. It's schedules and journal entries, done every month. It's also what separates books that record what hit the bank from books that tell you how the business is doing.
That's what we mean by complete financials: a real balance sheet, a depreciation schedule, loan schedules, and payroll with the tax detail broken out. When you engage us for both bookkeeping and tax preparation, we can coordinate the books with the return. The return is separately scoped and quoted.
Not sure yours are on the books properly?
Start with a no-prep, 15-minute call with Paul. If we're a good fit, we'll arrange a separate Books & Return Review to look at your equipment, loans, payroll, and last tax return together.
A quick, no-pressure call to see whether we're the right fit. No prep needed.
Good Books Mean a Better Tax Return
Bookkeeping and tax preparation are usually two separate relationships. Someone keeps the books, someone else prepares the return in March, and the return is only as good as what gets handed over. When you engage us for both, the work can be coordinated by one firm.
When your depreciation schedules, loan amortization, and payroll entries are already on the books, your return isn't rebuilt from scratch every spring. It's confirmed against work done all year.
That matters most where timing counts. Taking Section 179 this year or carrying the deduction forward. Setting an S corp officer's pay at the right number before the return is filed, not correcting it after. Knowing which subs crossed the 1099 threshold because the tracking ran all year.
When a client engages BATS for both bookkeeping and the [business tax return](/business-tax-returns), the two can be coordinated. The return is separately scoped and quoted, and it isn't part of the monthly bookkeeping fee. But when we've kept the books, the schedules and year-end numbers are already in place. There's far less to reconstruct before the return can begin.
When a client wants both, the books and the return come from the same place. That's the point of doing both under one roof.
"Been using Belshaw Accounting for a few years now for our bookkeeping, business taxes, and personal taxes, and it's made running Storm Peak Roofing Inc and Storm Peak Roofing and Gutters LLC a lot less stressful. Paul knows our businesses and doesn't just wait until tax time to talk to us. Anytime we're making a financial decision, he's the first call. Solid advice, easy to reach, and he explains things without all the confusing jargon. I would recommend to any small business owner."
Storm Peak Roofing
Three Florida Things That
Catch Contractors
Florida has rules that surprise trades owners. These three are worth knowing before a notice arrives.
01
Sales tax on materials
For most real-property contracts in Florida, the contractor is treated as the consumer of the materials. That means you pay sales tax when you buy them.
A qualifying retail-sale-plus-installation contract can be treated differently. But the contract has to support it:
The materials are specifically identified and sold at an agreed price.
The installation is separately agreed to.
Title and risk of loss pass to the customer as the materials are delivered.
Itemizing materials on an invoice doesn't create this treatment by itself. Your bookkeeping and tax treatment should follow the kind of contract you actually use. Identify that before the job starts, so the contract, the books, and the tax handling aren't working against each other.
02
Sales tax on materials
Your equipment, tools, and office furnishings are reportable to your county property appraiser on Form DR-405, due April 1.
Trailers properly classified and licensed as motor vehicles generally receive different property-tax treatment from ordinary business equipment. However, equipment mounted on a trailer and certain specialized or unlicensed trailers may still be reportable. Classification depends on the particular property and applicable Florida rules.
Florida offers a $25,000 tangible personal property exemption. A new business generally must file an initial return to establish eligibility. After the exemption is granted, the property appraiser may waive subsequent annual returns while the business remains eligible and the property's value does not exceed the exemption amount. If the value exceeds $25,000, or the appraiser requires a return, filing is required.
Pasco, Pinellas, and Hillsborough each file to a different office. Many contractors don't hear about any of this until a notice arrives.
03
Workers' comp starts at one employee, not four
Florida runs two different thresholds. Most businesses don't need workers' compensation until they have four or more employees. Construction needs it at one.
That catches trades owners, because they've heard the four-employee rule from another business owner and assumed it applies to them. It doesn't.
Corporate officers and qualifying LLC members may apply for an exemption. In construction, exemptions are limited to three qualifying officers or members. Each exempt person must own at least 10% of the company. Florida charges a $50 application fee. An exemption covers only the person who applies, not your other workers.
And if a subcontractor doesn't carry required coverage, their workers can become your employees for workers' comp purposes. That can leave you responsible for their coverage.
Could your bookkeeping be costing you money?
See exactly where your books stand.
You don't need thirty KPIs. You need three to five.
Many trades owners have no numbers at all. Others stare at a profit and loss that says the business made money, without saying why or where it went. Clean books make the right numbers visible every month.
The five worth tracking in a trades business:
01
Labor as a percentage
of revenue
Bill $10,000 on a job with $6,000 in crew costs, and labor is sixty percent. That tells you whether your pricing covers your people. Know your number, watch the trend, and check that your pricing keeps up.
02
Materials as a percentage of revenue
What you spend on materials against what you billed. Kept apart from labor, you can see whether you're losing margin on the buy, the markup, or the waste. Those are three problems with three fixes.
03
Gross profit margin
Gross profit divided by revenue, expressed as a percentage: (revenue minus cost of goods sold) ÷ revenue × 100. Direct costs commonly include crew labor, materials, subcontractors, and other costs directly attributable to delivering the work. It tells you whether the work is worth taking before overhead touches it.
04
Overhead as a percentage
of revenue
Trucks, insurance, tools, the office. It's the cost of keeping the doors open, apart from any one job. If overhead eats more than your gross margin earns, the business loses money at its current volume.
05
Net profit margin
What's left after everything. If the business grosses well but nets thin, the answer is usually in overhead or in owner pay. That's why the books have to keep those separate.
These numbers don't come from a bank feed. They come from books where materials, labor, and overhead are coded separately. That's what the chart of accounts in Section 3 is built to do.
If you can't pull these numbers from your current books, that's a good conversation to start.
See how the Books & Return Review works
Insert here
Residential Cleaning Company
What We Handle Each Month
01
Setup
We gather your job files, subcontractor agreements, W-9s, and equipment and loan documents. Then we set up books built for a contractor.
04
Assets and loans
Depreciation schedules for covered trucks and equipment. Amortization schedules for loans included in your engagement
02
Monthly bookkeeping
The accounts included in your engagement reconciled to their statements. Materials, labor, subcontractors, and equipment coded to separate accounts
05
Statements you'll read
A real balance sheet, and a P&L with cost categories broken out instead of lumped into one line.
03
Payroll
A payroll journal entry every period, with wages and employer taxes split apart.
06
Planning, when included in your engagement
S corp election timing, equipment purchase timing, and reasonable compensation, talked through before the return, not after. Planning is separate from monthly bookkeeping. Whether and how much is included is agreed separately, in your scope-of-work agreement.
What we don't do and where we'll help
We provide cash-basis write-up accounting: properly maintained, tax-ready books. Tax preparation, planning, and advisory are available as separately selected and scoped services. We don't send your invoices, chase your customers, or pay your bills. That's your office, and you're closer to it than we'll ever be. You know which customer is good for it and which one needs a phone call. Handing that to an outside firm usually slows it down.
If your office needs a hand getting set up, we're glad to help. Whatever you're invoicing out of, we can help get it running properly and walk your office manager through it. Same with entering bills and recording payments. We'd rather spend an hour showing somebody how to do it right than clean it up later.
That's about your invoicing and your bill paying, the day-to-day your office runs. The books themselves stay with us. That's the job you're hiring us for.
We don't do job-level costing either. That means coding every transaction to a project and allocating crew hours across jobs. It belongs in construction software with your field team entering time. It's a different service at a different price, and it costs a good deal more than what's on this page.
If you need someone in your accounts every day, you need a part-time bookkeeper on your team, not us. We'll tell you that on the call, not three months in
What It Costs
Your tier is based on your revenue. Your quote depends on transaction volume
and how much needs catching up.
Owner- Operator
Under $200K revenue
from
$495
/ mo
Owner-operators, and businesses with one or two employees.
Growth
$200K – $500K
from
$695
/ mo
Crews, subs, more accounts to reconcile.
Established
$500K – $1M
from
$995
/ mo
Multiple accounts, equipment, seasonal swings.
Scaling
Custom
Quote
Over $1M revenue
Our monthly bookkeeping work is designed around a contractor-focused chart of accounts and, where applicable, the equipment, loan and payroll records included in your written scope of work. The exact accounts, schedules, reporting and support are agreed for your engagement
Bookkeeping, tax preparation, and advisory are separate services. You can use one, a combination, or all three.
Three steps to books you can trust
15-minute call, then the Books & Return Review
Start with a short call with Paul to see whether we're the right fit. No prep needed. If it makes sense to go further, the next step is the Books & Return Review. We compare your books against your tax return, side by side, and show you the opportunities, the improvements, and the problems. We explain the scope and any fee for that separate Review case by case before proceeding.
Set up, clean up, catch up
We take your pile of statements, clean up what's there, and catch up whatever's behind. Assets get put on the books. Loans get amortization schedules. Payroll gets rebuilt. Everything is reconciled, so every dollar has a job
Kept current
Each month, the accounts and schedules in your engagement are reconciled and maintained, with statements you can use
Common Questions About
Contractor Bookkeeping
What does bookkeeping for a contractor include?
Contractor bookkeeping should include bank and credit-card reconciliations, separate tracking of materials, labor, and subcontractors, payroll journal entries, fixed-asset and depreciation schedules, loan amortization, and year-round W-9 and 1099 tracking. At BATS, the goal is tax-ready books that also show where your money goes and what your work really costs. At BATS, the specific accounts, schedules, and reporting included in your monthly service are defined in your scope-of-work agreement.
How much does bookkeeping for contractors cost?
Monthly bookkeeping for contractors starts from $495 a month. Revenue helps identify a starting tier; the quote also reflects transaction volume, number of accounts, payroll and the condition of your records. The four tiers are in the What It Costs section pricing above, from Owner-Operator up to a custom quote for larger businesses. Your written scope of work identifies the contractor-focused accounts, applicable equipment and loan schedules, payroll entries, reporting and support included in your engagement. Your business tax return is quoted separately, and so is catch-up work on books that have fallen behind. Job-level costing isn't part of the monthly service.
Do you do job costing?
No, and we'd rather tell you that up front than take your money and disappoint you. Job-level costing means coding every transaction to a project and allocating crew hours across jobs. That's real work, and it belongs in construction software with your field team entering time. It's a different service at a different price. What we do instead is separate your costs into categories that mean something: materials, labor, subcontractors, and equipment. Your margin becomes visible even without job-level detail. For many contractors, that answers the question they were trying to solve, which is where the margin is going. If you need job costing, tell us on the call and we'll point you toward what would do it.
Do you handle my invoicing and collections?
No, though if your office wants help getting set up, we're glad to give it. Invoicing, chasing customers, and paying bills should stay with you. You know which customer is good for it and which one needs a phone call. If your office manager wants help getting invoicing and bill entry running properly, we're glad to spend the time. After that, the day-to-day is yours and the books are ours. If you need someone in your accounts daily, you need a part-time bookkeeper on your team, and we'll say so.
What about my 1099s?
Once you pay a subcontractor enough in a calendar year to reach the federal reporting threshold, you generally have to file a 1099-NEC for them. The threshold is set by federal law and changes, so check the current amount each year. What doesn't change is the routine. Collect a W-9 before the first check, and keep accurate payment records for each subcontractor all year. A missing or incorrect taxpayer ID number can trigger backup withholding.
Do contractors need workers' comp in Florida?
Yes. Florida sets a lower threshold for construction than for most other businesses, so many small contractors need coverage sooner than they expect. Officers and LLC members can apply for an exemption, but an exemption doesn't cover your other workers or your subcontractors' workers. The Florida section above walks through the details.
I bought a truck. How does that get handled?
A truck usually creates two bookkeeping issues: the asset itself and the loan used to buy it. The truck belongs on a depreciation schedule. The loan needs to be split between principal and interest, so the balance on your books stays tied to what you owe. Trade-ins and auto expenses need care too. The tax treatment can vary with timing and your situation, which is why equipment purchases are worth discussing before tax season.
My books are two years behind. Is that too far gone?
No. We regularly work with businesses that need catch-up bookkeeping. Catch-up is quoted separately from your monthly fee as one-time work. We bring the prior periods current, reconcile back to the actual statements, and correct what was coded wrong. That includes putting assets on the books and building the loan schedules that were never there. The longer it sits, the bigger it gets. If there are unfiled 1099s or returns in the mix, that's the part worth moving on now. Read how one business turned it around in our catch-up bookkeeping case study.
Does an S corp owner need to handle health insurance differently?
Yes. If you own more than 2% of an S corporation, health insurance the company pays for you has special payroll and W-2 treatment. If it's handled incorrectly, it can create problems with the deduction on your personal return. When you engage us for the relevant bookkeeping and tax services, we can coordinate the pieces before year-end instead of untangling them at tax time.
Does keeping my books with you make my tax return better?
When you engage BATS for both, your bookkeeping and your business tax return can be coordinated. The return is separately scoped and quoted, and it isn't part of the monthly bookkeeping fee. Depreciation schedules, loan amortization, and payroll entries are already in place. That's what lets calls like Section 179 timing or setting an S corp officer's pay happen before the return is filed, not after. There's generally less to reconstruct before the return can begin.
Do I need to be an S corp?
Maybe. An S corporation can make sense for some profitable businesses, but it can also add payroll, tax, and compliance costs. The right answer depends on your profit, what you pay yourself, and how the business is structured. We look at the numbers before recommending it, and sometimes the right answer is not yet. See how one contractor's election played out in our S corp case study.
Why does my P&L look good when my bank account doesn't?
Some of the biggest drains on a contractor's bank account don't show up as expenses on the P&L. Buying a truck or a machine generally creates an asset to record, with tax deductions determined under the applicable expensing and depreciation rules. Its cash cost and P&L treatment may differ. Loan principal isn't an expense either; only the interest is. And owner draws don't touch the P&L at all.
So you can have a profitable year on paper and a checking account that felt tight all twelve months. Add retainage held on open jobs, and materials going out weeks before the draw comes in, and the gap gets wide. Good books help explain the difference.
Do you work with contractors outside Florida?
Yes. We're virtual first, so we can work with contractors outside Florida. The Florida guidance on this page won't necessarily apply elsewhere, and state-specific requirements depend on where your business operates.
Do I have to use all of your services?
No. Bookkeeping, tax preparation, and advisory are separate, and you choose the ones you need. Many clients use bookkeeping and tax preparation together, and some also add advisory. Others use just one. Your business tax return is separately scoped and quoted, and it isn't part of the monthly bookkeeping fee. When you do use more than one, the pieces can be coordinated.