Payroll

Hi, @KatRan7. I'd be glad to assist you today. 

You can enter their pay for the first quarter by setting them up as contractors and creating a check or bill outside of payroll. I can provide the details in accomplishing this in QuickBooks Desktop (QBDT).

Since the recently hired employees were contractors for the first quarter, they would still need 1099 tracking for that time. For this, we can recreate their profile by adding a middle name to avoid duplicate name error messages. Then, add the first quarter payments outside payroll. 

First, I'd recommend ensuring that the 1099-MISC feature is turned on. Here's how:

1. Select the Edit menu and then Preferences.
2. Select the Tax: 1099 menu. Then select the Company Preferences tab.
3. Select Yes in the Do you file 1099-MISC forms? section.
4. Click on OK to save your settings.

After this, recreate the contractor profile. You can follow these steps:

1. Select the Vendors menu and then Vendor Center.
2. Select the New Vendor dropdown and then New Vendor.
3. Enter their name with their middle names and complete their info.
4. Select OK when done.

Once done, set up each contractor for 1099 payment tracking. 

1. Select the Vendors menu and then Vendor Center.
2. Select a vendor's name and then select Edit.
3. Select the Address Info tab and review the info.
4. Select the Tax Settings tab.
5. Select and check the Vendor eligible for 1099.
6. Enter the tax identification number in the Vendor Tax ID field.
7. Select OK when done.

When done, you can write a check or enter a bill to pay your contractors. If you pay your contractors via direct deposit, check out this guide: Pay a contractor with direct deposit. 

Let me add this article as a reference in preparing and filing 1099s for your two employees who were former subcontractors: Create and file 1099s with QuickBooks Desktop. 

We'll be here in the Community if you have further questions about entering historical payments to your recently hired employees. We'll do our best to assist. Take care.