Why does DeskOps ask whether someone I paid is a contractor or an employee?

Contractor pay and employee wages go on different lines of your tax return — contractors on Schedule C line 11 and usually a 1099-NEC, employees on line 26 with a W-2 from payroll — and only employee wages count toward the wage limit on the qualified business income deduction. A payment that just says "labor" does not say which, so DeskOps never guesses: it still counts as an expense, labelled "type not confirmed" and marked "11 or 26" — never one line alone — in the Taxes breakdown and the accountant's files. You answer once for each person, and every payment to them — past ones in open months and every later one — is filed that way. When you log a new payment, pick Contractor pay or Employee wages and there is nothing to answer.