Hi there, suzannek.
Categorizing the person as contractor or vendor is important so QBO can accurately help track payments for tax filings.
If the person works for you as an independent contractor, you should set up that person as a vendor. The general IRS rule is that an individual is an independent contractor if you have the right to control or direct the result of the work but not the means and methods of accomplishing the result.
An independent contractor is a person, business, or corporation that provides goods or services under a written contract or a verbal agreement. Unlike employees, independent contractors do not work regularly for an employer but work as required.
If a 1099 vendor is missing from the list, you can make them eligible for a 1099. Please check this article on how to perform the steps: Add contractors or vendors when preparing 1099s.
Please know that you're always welcome to post if you have any other concerns. Wishing you and your business continued success.
