Large Purchases

[Jollywashers]

So I decided to pull the trigger on ordering equipment to Detail cars. Will I be able to claim all the purchases on my taxes next year. I still have a government job but after 22 years I’m getting ready to just call it quits. I will be detailing on my off days. Thanks for the advice.


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[UncleDavy]

So I decided to pull the trigger on ordering equipment to Detail cars. Will I be able to claim all the purchases on my taxes next year. I still have a government job but after 22 years I’m getting reading to just call it quits. I will be detailing on my off days. Thanks for the advice.


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The only way you can write off supplies and other business expenses it to start an actual detailing business. You can start by meeting with an accountant and starting an S corporation. An accountant will be less expensive than an attorney. Business and personal expenses can be claimed on your personal income tax.

 

[Jollywashers]

The only way you can write off supplies and other business expenses it to start an actual detailing business. You can start by meeting with an accountant and starting an S corporation. An accountant will be less expensive than an attorney. Business and personal expenses can be claimed on your personal income tax.

Even if it’s just a one man band ? Thanks for the advice



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[vincec]

Even if it’s just a one man band ? Thanks for the advice



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You need a have a state and possibly a local business license, depending on where you live, and be a S Corp, LLC, or Sole Proprietorship. You need to establish a formal business entity and carry any required insurance and pay the related business taxes and fees. You can't just do this as a hobby, you need to show where you are actually trying to run the business to make money or the IRS can go back and disallow your deductions.

 

[Route246]

Much will depend on your state and local parameters. In California it is pretty easy to get started to be a sole proprietorship. Just get an EIN from the IRS, file a fictitious business name in your county and a local business license. Of course, you'll need insurance, local permits, etc. If and when you business grows and hopefully generates profits you'll need to handle the taxes that goes along with this. I was a consultant for many years (software so I didn't have much equipment or expensive liability) and my CPA handled everything.