Bookkeeping for Construction & Trades

Contractors usually find out a job lost money after it closed. Costs land in general expense accounts rather than against the job, subcontractors are not set up for 1099s, and the books fall behind because the owner is on site.

Costed by job

Labor, materials, subs, and equipment against the job, while it is running.

Subs 1099-ready

W-9s captured at onboarding so January is not a scramble.

Draws that reconcile

Draw schedules tie to recorded costs — what the lender checks.

Retainage tracked

Held back amounts as receivable, not revenue you have not got.

What we handle

Job costing by project — labor, materials, subcontractors, and equipment
1099 subcontractor tracking and year-end information returns
Budget versus actual by trade category, with variance
Construction draw and loan tracking
Retainage tracked as receivable rather than revenue

Common problems we fix

Work-in-progress and job costs that were never tracked cleanly
Subcontractors not set up for 1099 reporting
Books months behind because you are on job sites

Why your state matters here

Bookkeeping for construction and trades is not the same in every state. Sales tax rates and what is taxable, registration and licensing, payroll rules, and filing cadence all vary — and for this industry those differences change real work, not just a number on a form. Pick your state below for specifics.

Trades and specialisms we cover

Construction & Trades is a broad category, and the bookkeeping differs meaningfully between the trades inside it. Here is what actually changes, trade by trade — each is handled under this service rather than as a separate engagement.

Flooring Contractors — jump to this section

Flooring lives on waste factors. You buy by the square foot with an overage allowance, and the difference between the allowance you bid and the material you actually consumed is the margin. Books that record a single materials figure per job cannot show it. Add showroom stock if you carry samples or inventory, manufacturer rebates that arrive months after the job closed, and install crews that are usually subcontracted rather than employed, and the accounts need to separate material, waste, install labour, and rebate income to tell you anything useful.

Roofing Contractors — jump to this section

Roofing is the trade where insurance work changes the bookkeeping. A claim job is billed against an adjuster’s scope, supplements are approved after work has started, and the final collected amount frequently differs from the original contract. Recording the initial contract as revenue and treating supplements as adjustments produces a moving target. Material is often drop-shipped straight to site and invoiced separately from labour, and warranty obligations extend years past the closing, which is a real accrual most roofers never record.

Concrete and Foundations — jump to this section

Concrete is priced by yard and poured on a schedule you do not fully control. Short loads, weather delays, and pump truck rental turn a clean estimate into a variable cost, and the pour itself is unrecoverable once placed. Job costing has to capture material by yard, pump and equipment rental separately from labour, and rework — because a failed pour is a cost with no revenue attached and it needs to be visible rather than absorbed into the job average.

Framing and Carpentry — jump to this section

Framing is labour-dominant, which makes loaded labour cost the number that decides profitability. A crew billed at bare wage looks profitable on every job; the same crew costed with payroll taxes, workers’ comp — which is expensive in framing — and tool allowance often does not. Lumber price volatility is the second factor: a bid held for sixty days against a moving material market needs the material cost recorded per job, not per period.

Drywall and Finishing — jump to this section

Drywall is measured in board and finished in levels, and the level of finish specified is what drives labour. Books that record one labour figure cannot tell you whether the level-five work you keep agreeing to is priced correctly. Material is comparatively cheap and labour comparatively heavy, so the crew mix between hangers, tapers, and finishers is the cost to track — usually as subcontractors, which makes W-9 collection during the year the difference between a calm January and a scramble.

Masonry and Stonework — jump to this section

Masonry carries unusually high material weight relative to value, so delivery, staging, and waste are larger line items than in most trades. Stone and brick are frequently bought per project rather than stocked, and remainder material has real value that most books write off entirely. Where restoration work is involved, the labour is skilled and slow, and estimating from square footage rather than from hours is where margin quietly disappears.

Fencing and Decking — jump to this section

Fencing and decking are high-volume, short-duration jobs, which means the overhead of costing each one individually can exceed the value of doing so. The workable approach is costing by job type rather than by individual job — so you know what a hundred feet of cedar privacy fence costs you, and can price the next one from data. Material deposits from customers are common and are a liability until the work is done, not revenue on receipt.

Excavation and Site Work — jump to this section

Site work is equipment-dominant, and equipment is where the accounting gets interesting. Owned machines carry depreciation, financing, fuel, and maintenance that must be allocated to jobs to produce a real hourly cost; rented machines are a direct job cost. Mixing the two produces an hourly rate that reflects neither. Hauling and disposal fees, often billed by the load, are the other cost that routinely lands in a general account and disappears from job margin.

Restoration Contractors — jump to this section

Water, fire, and mould restoration is the trade where the customer and the payer are different people. Work starts within hours of a loss, is scoped against an insurer’s estimating platform, and is paid weeks or months later once the adjuster agrees — with supplements negotiated after the work is already done. The receivable is therefore large, slow, and frequently different from the amount originally billed, which makes ageing by claim rather than by customer the only useful view. Emergency mitigation and reconstruction are effectively two businesses with different margins, and deductibles collected from the homeowner are a separate collection problem from the insurance balance.

Painting Contractors — jump to this section

Painting is labour-heavy with comparatively cheap material, so the estimate stands or falls on production rates — square feet per hour by surface and by coat — and books that record one labour figure per job cannot feed that back into the next bid. Residential repaint, new construction, and commercial work carry different rates and different payment behaviour. Material is often bought per job at a contractor rate, and unused product returned or carried forward has value that most books ignore.

Tile and Stone — jump to this section

Tile work carries high material value with a real breakage allowance, and the difference between the waste factor bid and the material actually consumed is margin that disappears if only a single materials total is recorded. Natural stone is bought by the slab with variation between lots, so remnant material has genuine value worth carrying. Substrate preparation is frequently discovered on site and is the most common source of change orders, which need capturing as they happen rather than argued about at the end.

Glazing and Glass — jump to this section

Glass is fabricated to measure, which means an error is a total loss rather than a rework — remake costs belong in their own account because they are a quality metric, not a general expense. Commercial glazing runs on long lead times with material ordered well ahead of installation, creating work in progress and deposits paid to suppliers. Insurance and warranty replacement work is a separate revenue stream with its own billing path.

Insulation Contractors — jump to this section

Insulation is priced per square foot at a specified R-value and installed in a narrow window between framing and drywall, so scheduling drives everything and a delay pushes crew cost with no revenue attached. Material is bulky, bought in bulk, and consumed across several jobs at once, which makes per-job material allocation a genuine exercise rather than a matter of matching invoices. Rebate and efficiency program payments arrive after completion and are often paid to a third party.

Paving and Asphalt — jump to this section

Paving is seasonal in most of the country and equipment-intensive year round, so the fixed cost of owning plant is carried across a compressed working season and has to be allocated accordingly. Material is priced by the ton against a volatile oil-linked index, meaning a bid held for weeks carries real price exposure that should be visible in job costing. Municipal and highway work brings prevailing wage rules and the weekly payroll reporting that goes with them, which changes how payroll has to be recorded from the first day on site.

Demolition Contractors — jump to this section

Demolition earns from the work and sometimes from the material removed, so scrap and salvage revenue is a genuine second income stream that many books never record. Disposal is the largest variable cost, billed by weight or by load, and it has to tie to the jobs that generated it. Where hazardous material is involved, the handling, testing, and disposal requirements are a distinct cost category that should never be blended into general disposal.

Welding and Fabrication — jump to this section

A fab shop is a small manufacturer: material is bought by weight, cut with offcuts and drop remaining, and converted through shop hours into a finished piece. Costing needs material, shop labour, consumables, and machine time against the work order, and drop material has value if it can be used again. Field work and shop work have different rates and different overhead, and mixing them makes both look wrong.

General Contractors — jump to this section

A general contractor’s books are dominated by subcontractor management: commitments issued, invoices approved against them, retainage held back, and lien waivers collected before payment. Where committed cost is not tracked alongside actual cost, a project can be substantially over budget while the ledger still looks fine, because the invoices have not arrived. Over- and under-billing against percentage of completion is the calculation lenders and sureties ask for and the one most contractors cannot produce.

Remodelers — jump to this section

Remodelling runs on change orders, and the difference between a profitable remodeler and an unprofitable one is usually whether changes were documented and billed at the time or absorbed to keep a homeowner happy. Allowances for fixtures and finishes need tracking against actual selections, because the overage is billable. Deposits and progress payments are collected ahead of work and are a liability until earned, which matters more here than in most trades because the deposits are large.

Not listed? Tell us what you do — these are the ones we are asked about most, not the limit of what we handle.

We keep the books. You run the business.

Categorization, reconciliation, month-end close, and clean financial statements — with nothing left for you to chase.

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How It Works

Free review

We look at how your construction and trades books are set up today.

Fix the structure

Chart of accounts rebuilt around how your industry actually earns and spends.

Catch up

Anything behind gets cleaned up at a fixed quoted price.

Close monthly

Current, reconciled books every month — ready for your CPA.

Construction & Trades Bookkeeping by State

Sales tax nexus and taxability, licensing, payroll rules, and filing cadence differ by state. Pick yours for a state-specific guide.

Construction & Trades — Frequently Asked Questions

Do you understand construction and trades specifically?

Yes — that is the point of setting the books up by industry. Contractors usually find out a job lost money after it closed. Costs land in general expense accounts rather than against the job, subcontractors are not set up for 1099s, and the books fall behind because the owner is on site.

What does bookkeeping for construction and trades actually involve?

Job costing by project — labor, materials, subcontractors, and equipment; 1099 subcontractor tracking and year-end information returns; Budget versus actual by trade category, with variance; and 2 other recurring pieces. It is done monthly rather than reconstructed at year end, so the numbers are usable while the decisions are still open.

What usually goes wrong in construction and trades books?

The three we see most: work-in-progress and job costs that were never tracked cleanly; subcontractors not set up for 1099 reporting; books months behind because you are on job sites. If you cannot see it by job, you cannot price the next one.

Do you work with flooring contractors, roofing contractors, concrete and foundations?

Yes — those are three of the 18 trades covered under this service, and each is listed on this page with what changes about its books. They are handled under one engagement rather than quoted separately.

Do you work in the accounting file my construction and trades business already uses?

Yes. We work inside your file so you keep ownership and full visibility. If you do not have one set up yet, we build it around your industry from the start, including a chart of accounts that matches how you actually earn.

Can you clean up construction and trades books that are months behind?

That is our specialty. Cleanup is quoted at a fixed price after a short no-obligation review, so you know the cost before any work begins. Scope varies enormously, so we look first and quote second.

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