# Internal and indirect time: PTO, holiday and overhead

- URL: https://www.usewisecost.com/help/time-tracking/internal-and-indirect-time
- Audience: Admins
- Last updated: 2026-09-19
- Part of the WiseCost Help Center: https://www.usewisecost.com/help

> Let employees log PTO, holiday, overhead and other indirect time in WiseCost by enabling indirect labor accounts in Company settings → Time Tracking.

Internal or indirect time is time that does not belong to a contract: PTO, holiday, overhead, G&A, bid and proposal. To let your team log it in WiseCost, go to **Company Setup → Company settings → Time Tracking** and, in the **Internal / Indirect Time** card, choose the indirect labor accounts they can charge time to. Employees then pick one of those accounts instead of a contract.

**Who can do this:** an Administrator.

## Before you start

The accounts offered come from accounts already classified with an indirect labor role in **Company Setup → Accounts**. If the list is empty, assign roles first. See [Assigning account roles](https://www.usewisecost.com/help/reports-and-audit-trail/indirect-rates-assigning-pools-to-accounts).

## Enable accounts for time entry

1. Go to **Company Setup → Company settings → Time Tracking**.
2. In the **Internal / Indirect Time** card, open **Accounts for time entry**.
3. Select each indirect account your team can log time against, and give it an alias your team will recognize, such as "PTO" or "Holiday".
4. Optional: under **Posting class for indirect entries**, choose the QuickBooks Class coded onto every indirect journal line. Leave it empty if your company uses Projects and no Classes.

[Screenshot: Time Tracking settings with the time entry form fields and internal time accounts]

## What happens next

When employees log time they see the enabled accounts, by their alias, next to their contracts. Labor Distribution posts that labor cost to the indirect account, which keeps direct labor and indirect labor apart in QuickBooks Online and feeds the [Indirect Rate report](https://www.usewisecost.com/help/reports-and-audit-trail/indirect-rate-report).

## Why it matters

Both DCAA timekeeping and time and effort reporting under the Uniform Guidance expect a record of all the time an employee works or is paid for, not only the hours charged to a contract or award. Internal time is how the day adds up. If you also [require expected hours](https://www.usewisecost.com/help/time-tracking/requiring-expected-hours), it is what lets an employee reach their total in a week with a holiday.

## Common questions

### Where do employees log PTO or a holiday?

In the same Time Tracker. They choose the internal account, for example "PTO", instead of a contract.

### The account I need is not in the list. Why?

Only accounts with an indirect labor role appear. Give the account its role in **Company Setup → Accounts** and come back.

## Further reading

- [5 DCAA Compliance Mistakes That Small Contractors Keep Making](https://www.usewisecost.com/blog/dcaa-compliance-mistakes-small-contractors)
- [Direct vs. Indirect Costs in Government Contracting: A Practical Guide](https://www.usewisecost.com/blog/direct-vs-indirect-costs-government-contracting)
- [How to Classify Indirect Costs (Fringe, Overhead, and G&A)](https://www.usewisecost.com/blog/how-to-classify-indirect-costs-govcon)