Where would I deduct expenses paid for employees I hired through a temp agency?

[mesquitebean]

What was your business relation to the workers?  "Whose" employees were they?    Was their employer the agency?  Did you merely contract with the agency to provide you their contract labor, and the agency provided all the employment services, paid their wages, deducted their withholding, FICA, etc?     Or were you the employer and had to pay all that?

[dulan39]

We are a plumbing business and used a staffing agency to hire our workers for the majority of the year. Basically we paid the agency a premium for their hourly wages.

[mesquitebean]

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@ dulan39 wrote:

We are a plumbing business and used a staffing agency to hire our workers for the majority of the year. Basically we paid the agency a premium for their hourly wages.

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I still don't understand "whose" employees they were; i.e., who is legally their employer, pays their wages, provides them their W-2, withholds their taxes, FICA, etc.    Do you do all that?  Was the "premium" you paid like a finder's fee or commission, but you are the actual employer of record that pays their wages, employment taxes, provides their W-2s, etc.?    And are you asking how/where to report that "premium expense" that you paid to the agency that provided them?   Or are the workers "contract labor" and the agency considered the employer?

  I'm a fellow user and not a tax person, so I won't give any tax advice.  You'll have to wait and see if any tax person will see this thread and assist you.  Or we can tell you how to phone TurboTax Support.

In any case, there's something that needs to be clarified first that may help anyone who assists you here.   You said "we are a plumbing business."    What does the "we" mean?   What kind of business entity; i.e, how is your business organized?  Are you a self-employed business/sole proprietor, a single-member LLC, multi-member LLC, partnership, etc.   Or is "we" a joint venture or LLC of husband and wife?

You appear to be using Self-Employed Edition which is for a self-employed business, independent contractors, and sole proprietors, and can be used by a single-member LLC in some situations.   Multi-member LLC, partnerships, corporations, etc. require a different product. 

Or is the "we" the 2 members of a married husband-wife and if so, is it in a community property state?

[mesquitebean]

@jtax 

Are you please able to assist in this thread when you are next in the forum.  Thanks!

[jtax]

@mesquitebean I don't know enough about this area to give the OP a definitive answer. Here are a couple of links discussing the issue, albeit in the context of a an S-Corp, which raises issues not present for a sole proprietorship or LLC (which has not elected S-Corp status).

The bottom line seems to be, though I'm not certain,that if if the payment org (a PEO) is reporting the employees on its own EIN, the business doing the work seems to report the expense on whatever line makes the most sense, sometimes "other" and fully discloses what the payment is. 

Other articles discuss issues of who the actual employer is and who has liability for unpaid FICA/withholding. 

This could be a case where the OP is best off hiring a CPA for an hour to get professional, written, advice, rather than relying on an Internet form of volunteers.

links of some interest: 

https://proconnect.intuit.com/community/tax-talk/discussion/qbi-and-leased-employees/00/1863

https://proconnect.intuit.com/community/tax-talk/discussion/qbi-and-leased-employees/00/1863

https://www.atxcommunity.com/topic/20596-s-corp-using-peo/

[Anonymous]

if your business is not an LLC, S Corp, Partnership, or C-corp and by we you mean you and your spouse

for non-community property states you report on two schedule C's spliiting the income and expenses between you and your spouse based on the relative time you each spent working for the business. 

in a community property state everything is split 50/50

you paid a service agency so the expense can go on the line  for contract labor 

for a husband/wife LLC (becuase a LLC can't elect not to file) or partnership file form 1065 

for S-corp form 1120-S

for C-corp form 1120

[R1ck-R1ck]

I paid temp agency, and temp agency paid all taxes for temp employees.

[mesquitebean]

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@ R1ck-R1ck wrote:

I paid temp agency, and temp agency paid all taxes for temp employees.

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This is an old thread from 5 years ago, and since no one has responded to your new post so far, it may not be seen by many of the forum people.   I'll see if I can attract one of the TurboTax Experts to help you.

@ AmyC  (or anyone available) are you please able to help this user with how to report their business expense for hiring a temp agency to provide temp employees?    Thanks!