Texas sales tax help
The lump-sum vs separated contract detail behind your construction books, configured in QuickBooks.
Sales tax helpTexas · Construction Accounting
Texas construction accounting that knows which job made money.
In Texas, payments to a contractor or subcontractor under a contract to improve real property are trust funds under Property Code §162.001, and a contractor with a written contract over $5,000 to improve a residential homestead must deposit those funds in a construction account and keep a record of every deposit and disbursement (§162.006–162.007). We keep each job’s receipts and payments traceable to it, set up real job costing, WIP, AIA billing, and retainage, get the Texas sales-tax contract structure right (lump-sum vs separated), keep COGS clean for the margin tax, and track subcontractor 1099s — prepared by a senior bookkeeper who works in your software, or by a signed specialist practice when your books need one.
Monthly bookkeeping: $500–$2,500+ a monthWhat sets the price
If your file needs our paid diagnostic first, its fee is credited in full against the cleanup. Either way, you get a fixed fee in writing before any work starts.
§ The short version
Texas construction accounting from TechBrot shows which job made money: job costing, WIP schedules, AIA billing and retainage in your own QuickBooks file, with monthly bookkeeping at $500–$2,500+/mo. A written contract over $5,000 to improve a residential homestead needs a construction account (Property Code §162.006), and lump-sum or separated contracts change who pays Texas sales tax.
They took something that felt overwhelming to me as a first-year business owner and made it simple.
What stood out the most was TechBrot Inc’s attention to detail.
Intuit QuickBooks Certification Level 2 and QuickBooks Workforce Certification,
§ 01 · Why Texas contractor books break
Three places Texas contractors lose the numbers.
Profitable-looking contractors go under when these go unmanaged. Knowing which one you’re in tells us where to start.
01Job costs
Jobs that quietly lose money
Without real job costing and a WIP schedule, a contractor can look profitable while individual jobs bleed — the loss only shows up after the job (and the cash) is gone.02Sales tax
Lump-sum vs separated contracts
Texas taxes construction by contract structure — lump-sum makes you the consumer; separated makes you the collector. Books set up wrong for your contract type mean sales tax is mishandled on every job.03Subs & 1099s
Subcontractor records
A sub-heavy roster with sloppy 1099 records is an audit and a backcharge waiting to happen — and blurs the job-cost picture when sub costs aren’t tied to jobs.§ 02 · What TechBrot handles
How we cost a Texas contractor’s jobs.
Every engagement is scoped to your jobs and crew, delivered in your own QuickBooks file by your TechBrot team, with every close reviewed by a Certified QuickBooks ProAdvisor.
01
Real job costing
Labor, materials, subs, and equipment tied to each job so true job margin is visible, not a blended number.
QuickBooks accountant02
WIP schedules
Costs vs billings tracked per job so over- and under-billings and real margin are visible before the job closes.
Monthly bookkeeping03
Contract-correct sales tax
Books set up for lump-sum or separated contracts so Texas sales tax is handled right on materials — your CPA confirms the determination.
Sales tax help04
AIA billing & retainage
Progress billing (AIA G702/G703) and retainage receivable/payable tracked so cash and billings stay straight.
QuickBooks accountant05
Margin-tax COGS
Construction COGS tracked cleanly so your CPA can take the COGS deduction on the franchise (margin) tax.
Franchise tax help06
Subcontractor 1099s
Sub records and 1099s kept clean and tied to jobs — ready for filing season and clean on the job-cost side.
Bookkeeping services§ 03 · Tools we work alongside
Connected to how you build.
- Procore, Buildertrend, and construction-management platforms
- Knowify and job-costing tools
- Gusto, ADP, and construction payroll providers
- Certified-payroll tools for federal Davis-Bacon jobs
- Bill.com for subcontractor and vendor AP
- QuickBooks Online or hosted Desktop — your file
We reconcile alongside the project-management and payroll tools you already run — the books read from how you build.
§ 04 · How engagements work
From guesswork to job-level profit.
Every Texas construction engagement follows the same rhythm — books accurate first, job-profit visibility second, advisory third.
- Step 1
Free job & contract review
A QuickBooks ProAdvisor reviews your jobs, WIP, and how your contracts are structured for Texas sales tax — at no cost. - Step 2
Written fixed-fee scope
A written scope and fixed fee within 3 business days — setup, cleanup, or monthly. - Step 3
Build job costing & WIP
Job costing and a WIP schedule set up, AIA billing and retainage tracked, sales tax set to your contract structure. - Step 4
Monthly job profit
A monthly close showing job-level profit and WIP, CPA-ready and bonding-ready.
§ 05 · Beyond the books
Accurate job costs are the start. Winning the right bids is the point.
When job costs are accurate and WIP is visible, the decisions get real: which work to bid, which crews and job types make money, whether to take the bonded job — answered from numbers that tie.
That’s where fractional-CFO advisory picks up, on cleaned-up books, in coordination with your CPA and bonding agent.
Checked against the Texas Comptroller of Public Accounts.
§ 07 · Around this page
Around Texas.
Texas QuickBooks ProAdvisor & bookkeeping
The state page: services, industries, cities and the Texas tax terms in one place.Construction accounting, nationally
The national engagement this page is the Texas version of — same scope, same written fixed fee.Not sure where your file stands? Start with the free QuickBooks file review · how Texas compares: state-by-state tax quirks.
§ 08 · FAQ
Texas construction accounting questions.
What does Texas construction accounting include?
Real job costing, WIP schedules (costs vs billings), AIA progress billing and retainage, books set up for the Texas lump-sum vs separated sales-tax contract treatment, margin-tax COGS tracking, and subcontractor 1099 records — in your own QuickBooks file. We deliver the books; your CPA confirms contract taxability and files.
How does Texas sales tax work on a construction contract?
It turns on how the contract is written. Under Texas Comptroller rules, a lump-sum contract makes the contractor the consumer — you pay sales tax on the materials you buy and don’t separately collect it from the customer. A separated contract (labor and materials stated separately) means you collect sales tax on the materials charge. New construction vs. repair or remodel, and residential vs. commercial, also change taxability. We set the books up to match your contract structure; your CPA confirms the determination and files. Taxability varies — confirm with the Comptroller and your CPA.
How do job costing and WIP schedules work?
We tie labor, materials, subcontractors, and equipment to each job and maintain a WIP schedule comparing costs incurred to amounts billed. That surfaces over- and under-billings and shows real job margin before the job closes — so a job that’s bleeding gets caught while you can still do something about it, not at year-end.
Do Texas contractors have to deal with prevailing wage and certified payroll?
Yes, on public work. Texas Government Code Chapter 2258 requires a worker on a public work for the state or a political subdivision to be paid not less than the general prevailing wage rate, which the public body awarding the contract sets, and requires the contractor and each subcontractor to keep a record of each worker’s name and occupation and the actual per diem wages paid (§2258.024). Certified payroll under federal Davis-Bacon applies on federally funded projects. We keep payroll and job coding clean so those records and certified payroll can be produced accurately where they’re required; the submission and labor-compliance obligations stay with you or your payroll provider. We keep the books behind it right.
How do you handle the franchise (margin) tax for contractors?
Construction generally benefits from the cost-of-goods-sold deduction on the Texas franchise (margin) tax, so we track COGS — materials, subs, and certain labor — cleanly and distinctly from overhead. That gives your CPA a clean base to compute the margin and choose the best deduction method. We track it; your CPA computes and files.
Do you work in my own QuickBooks file?
Yes — your file, your data, in QuickBooks Online or hosted Desktop, with a senior bookkeeper assigned to your file, and every close reviewed by a Certified QuickBooks ProAdvisor before it reaches you, connected to your construction-management and payroll tools rather than proprietary software.
Texas contractors start here