What construction accounting in Austin has to handle that generic bookkeeping doesn't

A South Austin remodeler bids a 480-square-foot addition at $96,000. No lien, no sub who walked, no change-order fight. The job closes and nets $3,900. Nothing went wrong in the field — it went wrong in the estimate and in the books. Most contractors who type construction accounting Austin into a search bar are chasing that exact gap: money that was there at bid and gone at closeout.

A bookkeeper who does restaurants will give you a clean P&L for the month. That tells you the company made money. It does not tell you which of your six open jobs paid for the other five.

Austin adds its own wrinkles. Permit and review timelines on the City of Austin side mean a job you bid in March can start in June with different material pricing. Custom builders out toward Lake Travis run draw schedules. Downtown tenant-improvement GCs hold retainage — a slice of every invoice withheld until final acceptance — and they hold it a long time. Hail work on the east side comes with insurance carriers, supplements, and deductibles that have to be coded somewhere.

The fix is structural, and it follows the job: bid, build, closeout.

Before the job: bid off a burdened rate, not a wage

Your burdened rate is what an hour of labor actually costs you — base wage plus employer payroll taxes, workers' comp, general liability, truck, phone, and paid time off. Almost every blown bid I've seen started with a wage in the estimate instead of a burdened rate.

Here's the arithmetic on an HVAC changeout. Say your lead installer is at $30 an hour, and say your comp, employer taxes, liability, and truck cost add $12.60 an hour on top. Burdened rate: $42.60.

Now say the job is 160 crew hours, $7,200 in equipment and materials, and $900 in crane and permit cost.

  • Priced at the wage: $30 × 160 = $4,800. Plus $7,200 plus $900 = $12,900 in cost.
  • Priced at the burdened rate: $42.60 × 160 = $6,816. Plus $7,200 plus $900 = $14,916 in cost.

At a $19,000 contract, the first version says you made $6,100. The real number is $19,000 − $14,916 = $4,084. You just found $2,016 that never existed. Run that error across twelve jobs a year and you've bid away a truck.

Before the job starts, you also need cost codes in place — the buckets each dollar gets filed into, like labor, material, subcontractor, equipment, permit. Four or five codes per job is plenty for a small crew. Twenty is a code nobody uses.

During the job: progress billing, retainage, and the change order nobody wrote down

Progress billing means invoicing as the work completes instead of once at the end. If you're on a draw schedule with an Austin builder, you're already doing it — the question is whether your books reflect it.

Two numbers matter mid-job. Overbilling is when you've billed more than you've earned in completed work; underbilling is the reverse. Overbilling feels like profit in the bank account and isn't — it's work you still owe. Underbilling is cash sitting in someone else's account.

Retainage needs its own account, not a shrug. Say a GC holds back $12,000 on a $120,000 commercial fit-out until final acceptance. If that $12,000 is sitting in regular accounts receivable, your aging report lies to you every month and you chase the wrong invoice.

Change orders are where small crews bleed. The rule I'd enforce: no extra work gets scheduled until the change order is written, priced at the burdened rate, and entered against the job's cost codes. A verbal "yeah, go ahead" from a homeowner in Hyde Park is not a billing document.

After the job: closeout, the WIP true-up, and the January 1099 pile

WIP — work in progress — is the schedule that compares what each open job has cost you against what you've billed, so you can see earned profit instead of guessing. At closeout, you true it up: final costs in, retainage released, the job closed, and the real margin recorded against the bid.

That true-up is the only place you learn anything. A roofer who finds out three jobs in a row ran 18 hours over on tear-off doesn't have a labor problem — he has an estimating assumption that needs changing.

Then there's January. If you pay subs — and in the Austin trades, most of you pay a lot of them — Form 1099-NEC reporting kicks in for 2026 at $2,000 of nonemployee compensation to a payee. The form has to be furnished to the sub and filed with the IRS by January 31. If you're filing on paper, Form 1096 goes with the batch.

The way that goes wrong is predictable: a sub gets paid out of a personal account in May, nobody has a W-9, and in January you can't reach him. Collect the W-9 before the first check clears. Every time.

Cash basis or accrual: which one to run your Austin jobs on

Cash basis records money when it moves. Accrual records costs and revenue when the work happens. Here's the tradeoff for a small crew.

Cash is simpler and matches your bank, but it misreads every job that spans a month-end — material delivered in May, invoiced by the supplier in June, lands in the wrong month and makes a profitable job look bad.

Accrual costs more bookkeeping time and will show profit on jobs whose cash hasn't arrived yet. That's the complaint I hear most, and it's fair.

My verdict: run job-level reporting on accrual, because the point of job costing is matching cost to the job that caused it — and cash basis structurally can't do that. Keep your return on whatever method it's already filed under. Watch the bank balance separately; accrual profit has never once made payroll.

What to hand off and what to keep in your truck

Keep the field discipline: time coded to the job daily, W-9s before payment, change orders in writing, receipts photographed at the counter. Nobody off-site can do those for you.

Hand off the close — reconciling bank, card, payroll runs and supplier bills into clean books, keeping cost codes consistent, and producing a job report you can read. That's what monthly bookkeeping is for, and it's where job costing and WIP tracking get built on top.

Submit a pricing request and tell us your trade, your crew size, and how far behind the books are.