This Podcast Is Episode Number 0218, And It Will Be About Multiple Contracting Companies In QuickBooks Leads To Catastrophic Ruin     Contractors, Bookkeepers and Tax Accountants are trying to keep everything all in one place. That is great. A single bank account on the surface is the answer in simplicity. Sharie’s Cash Management 101 Training I Teach Contractors Please Do Not Do This! Why – when putting everything in one bank account; it could be a FINANCIAL DISASTER.   Go to Home Depot, Lowes or any other larger store.   Use your debit card; Drop or lose your debit card, Someone finds it and buy stuff until he or she have spent all your money! (may be a little harder with the chip but how many places can you run your debit card as a credit card?)   The point is that within a short time – All the money could be GONE! ALL THE MONEY COULD BE GONE BEFORE YOU REALIZE THERE IS A PROBLEM All the money is all the money and losing it could put a company out of business Just as there are Common Sense rules about Sharie’s Cash Management 101Tips, there are common sense rules about mixing multiple companies in a single QuickBooks file: Does each company have its own Federal Tax ID number? If Yes, The Company needs its own QuickBooks File. Everyone can own Multiple Companies  Depending on the structure if the financial statements are on a Schedule C And 1040 or 1120S (S-Corp) or other return that in turn rolls up into The Contractors personal 1040 return. The annual tax return is pages and pages long (feels like a zillion if you have to make paper copies) Your banker wants the 1st two pages of your personal 1040 Annual Tax Return.  If you need commercial accounts, Dun & Bradstreet wants the 1st two pages of your business tax return.  Why because the 1st two pages is the summary of all the pages and worksheets that follow?   As a Construction Contractor, you need the details of the balance of the pages to run your business. How do you know how much money each company is making?    I can think of several examples of multiple companies being in a Single QuickBooks File. Husband has a Construction Company and Wife has a Non-Construction Company all mixed together.   Next example: Construction Company, Non-Construction Company plus a few Flipper houses for friends, and a few rental homes for themselves. Add in a few side jobs that are Professional Services. The word MEGA-MESS comes to mind: The Liability Insurance Company will take the easy way out.   What are Gross Sales for a specific date range? (all companies combined) The IRS will take the easy way out – You have one Federal Tax ID number Your Worker’s Comp Program will take the easy way out – What is the highest rate for the tasks? Apply that rate to all employees regardless of what their duties are (or which company) I know of a small company that everyone is charged the same Worker’s Comp rate because the combined office and shop space is small. In Washington State – Plumbers are at the field rate for workers comp even when they are cleaning their truck at the shop.  Why? Because Labor & Industries “Says – cleaning the truck is all part of the job.” No Lower Shop Rate is allowed.   Overhead is different for each of the following companies: Construction Company Non-Construction Company (could be day care, hair salon, espresso stand, etc.)    Construction Management Services for Flipper houses for friends Professional Services as a 1099 Contractor Flippers House turned into Rentals Flippers House Sold Rental homes Mixing Companies in a Single QuickBooks File: I can tell you "Please Don’t Do This!" Your Tax Accountant can tell you, "Please Don’t Do This!" Your Banker can tell you, "Please Don’t Do This!" The one person who won’t tell you not to do this is the In-House Bookkeeper. Why? They want to keep their job! The Construction Bookkeeper...