From bid to final draw, the numbers hold.
Construction accounting is its own discipline: revenue that spans years, retainage you’ve earned but can’t touch, subs who are one misclassification from being employees, and a bonding company reading your financials like a loan officer. We’ve kept books for builders since 2009.
Where builders’ books go wrong.
Job Margin & Crew Burden Rate
Without job costing, a profitable-looking year can hide two jobs that lost money and one that carried them. We cost every job (labor, materials, subs, equipment time) so the next bid is priced on evidence.
WIP Schedules & Bonding Capacity
Work-in-progress schedules are the first thing a bonding company or lender requests, and building one from scratch under deadline is miserable. Ours are maintained continuously, showing over- and under-billings job by job.
Worker Classification & 1099 Subcontractor Compliance
Control the schedule, supply the tools, and pay by the hour, and your ‘sub’ may be an employee with back payroll taxes attached. We review arrangements before the state or IRS does.
Retainage booked as if it were cash
Earned-but-held retainage distorts both taxes and cash planning when it’s coded like ordinary receivables. We track it separately, so you know what’s truly collectible and when.
What we handle for builders.
Business and owner returns together, job-costed books with retainage tracked separately, §179 and bonus depreciation timed against your income, cash forecasts built on draw timing, entity analysis, and crew payroll with sub 1099s.
If you’re the one who keeps the books.
In a lot of shops the books live with the office manager, a spouse, or a partner.
What stays with you
- Coding bills and sub invoices to the right job
- Keeping pay applications, change orders, and lien waivers together
- Collecting a W-9 before a new sub gets paid
We reconcile every account and close the month. How the monthly close works.
Setting up for the first close? Build My Document List.
What builders ask us.
What does my bonding company actually want to see in my financials?
Credible, consistent statements with a work-in-progress schedule that ties to them: contract values, costs to date, billings, and the over/under-billing position on every open job. Bond underwriters read WIP the way banks read collateral. A builder with clean WIP and modest equity often bonds better than a bigger builder with messy books.
Cash, accrual, or percentage-of-completion: which method should my construction company use?
It depends on your size, contract length, and entity. The tax code gives smaller contractors real choices here, and the right method can defer meaningful tax. It’s also easy to get wrong by default: the method you started with as a one-truck operation may not be the method you’re entitled to, or best served by, today. We run it as a facts-and-numbers analysis.
How should retainage be handled for taxes?
Retainage is earned revenue you can’t collect yet, and depending on your accounting method it may not be taxable until the right to receive it is fixed. Coding it like an ordinary receivable can accelerate tax on money you won’t see for a year. We track it separately in the books and treat it deliberately on the return.
Do you handle 1099s for all my subs, and what do you need from me?
Yes. What we need is simple but non-negotiable: a W-9 from every sub before their first check. Chase it in January and you’ll chase it forever. We build W-9 collection into the payment workflow, track payments all year, and file the 1099-NEC and 1096 transmittals on schedule.