[MarcieRBlack]

There are many reasons why I wouldn't hire everyone else in my company as a contractor. One reason is that this is bad for the employee/contractor. I wouldn't be able to give that person benefits for example. I need to attract the best people to my company and that means giving them fair compensation including benefits.

Yes, PTO does go into indirect costs and can not go into direct costs. Labor is separated out by hours worked for each customer. Any PTO of time working on indirect, those hours can not be billed to a customer.