When to report contract labor vs legal and professional fee

[Chabo]

I do projects for others where I need engineering services. I have always reported these in TurboTax as "Legal and Professional Fees." Should I be reporting this as "Contract Labor" instead? When do you use one category vs. the other?

[MinhT · Accepted solution]

This is clearly an instance where you can report the expense in either category. Contract labor is when you use sub-contractors who are issued forms 1099-MISC. Legal and professional fees are fees paid to lawyers and other professional help. You can use either category for the engineering fees. The IRS is very flexible on the categorization of expenses.