What is the purpose of a Retainage Code and how does this integrate with QuickBooks?

Retainage Cost Codes play a vital role in managing the retainage amounts for both subcontracts and invoices in Contractor Foreman. Retainage refers to a portion of the contract amount that is held back until the project is fully completed to ensure the work is finished to satisfaction. Setting up Retainage Cost Codes ensures that the retainage amounts are always directed to the correct cost code and that this process integrates smoothly when syncing with QuickBooks.

How to Set Up Default Retainage Cost Codes:

From the Main Menu, navigate to Settings and then choose Cost Codes. Open the Action drop-down menu on top left and select Add & Set Retainage Code. This action will take you to the financial settings area.

Once in the financial settings, find the section titled Automatically select to ‘Tax’ these item types.

Click on the green pencil icon to enter Edit mode. Here, you can set up default cost codes for two key areas:

Sub-Contract Retainage Cost Code: This code applies to the retainage held from subcontracts.

Invoice Retainage Cost Code: This code is used for retainage on invoices.

For both of these, select the appropriate cost code from your existing list of cost codes. Once the retainage cost codes are selected, save your changes to finalize the setup.

When syncing Contractor Foreman with QuickBooks, the retainage amounts assigned to these cost codes will transfer seamlessly. This ensures that all retainage data, including amounts and their respective cost codes, are correctly reflected in QuickBooks for accurate accounting.