Question about Tax Deductions for detailing?

L

LiloleG

New member
Joined
Jun 27, 2009
Messages
14
Reaction score
0
Question about Tax Deductions for detailing?


I'm trying to start a business like many on here have done before me. I am looking at a pickup truck, as well as all my equipment to get started.

I am dancing between a Sole proprietorship and an LLC.

I read a lot about starting a business online. I get a wealth of knowledge about the how to's of detailing, advertisement and marketing. Unfortunately it only touches on tax deductions.

I know that I can deduct ANYTHING I use for my business. My question is how is it decided how much is deducted from what I spent?

I've been told that its 100% reimbursed, however I am not sure that is true.

I can sure use advice from any existing business owners.

:)
 
Re: Question about Tax Deductions for detailing.

Im not exactly sure, but I decided on the Sole Proprietorship or DBA.
Since i really dont plan on hiring employees.
 
Re: Question about Tax Deductions for detailing.

LiloleG said:
I'm trying to start a business like many on here have done before me. I am looking at a pickup truck, as well as all my equipment to get started.

I am dancing between a Sole proprietorship and an LLC.

I read a lot about starting a business online. I get a wealth of knowledge about the how to's of detailing, advertisement and marketing. Unfortunately it only touches on tax deductions.

I know that I can deduct ANYTHING I use for my business. My question is how is it decided how much is deducted from what I spent?

I've been told that its 100% reimbursed, however I am not sure that is true.

I can sure use advice from any existing business owners.
Click to expand...

It's not realy tax deductable as such. To break it down in the easiest way I can for you, basically you have income and expenses. At the end of the day ( year) you have "x" amount of expenses and "y" as income. Hopefully your "y" is bigger than your "x".
Anything you purchase or spend on products is an expense against your income. All of your start-up equipment can be deducted as an expense. But you might have to speak to an accountant some of the larger purchases might have to be depreciated instead of straight out expensed.
Sorry, I bet that was confusing as hell, I hoped it helped a little at least
 
Re: Question about Tax Deductions for detailing.

i believe that its 100% of what you spend not exaclty reimbursed but taken off the taxes your business would pay on your anual income. im prolly wrong but thats what i have been told.
 
Re: Question about Tax Deductions for detailing.

DBA too.:xyxthumbs:
 
Re: Question about Tax Deductions for detailing.

jpegs13 said:
It's not realy tax deductable as such. To break it down in the easiest way I can for you, basically you have income and expenses. At the end of the day ( year) you have "x" amount of expenses and "y" as income. Hopefully your "y" is bigger than your "x".
Anything you purchase or spend on products is an expense against your income. All of your start-up equipment can be deducted as an expense. But you might have to speak to an accountant some of the larger purchases might have to be depreciated instead of straight out expensed.
Sorry, I bet that was confusing as hell, I hoped it helped a little at least
Click to expand...

so if I were to spend x amount what percentage of x do i get for tax deduction when tax time comes around?
 
Re: Question about Tax Deductions for detailing.

LiloleG said:
so if I were to spend x amount what percentage of x do i get for tax deduction when tax time comes around?
Click to expand...

100% if the expenses were for business purposes
 
Re: Question about Tax Deductions for detailing.

LiloleG said:
so if I were to spend x amount what percentage of x do i get for tax deduction when tax time comes around?
Click to expand...

Regardless to what you read in this thread, hire a CPA. Trying to do business taxes on your own can lead to some real problems.

As far as what expenses you can deduct will depend on what they are for. In many cases you can write off expenses dollar for dollar, ie your supplies expense for LSP's polishes, towels, etc., any mileage you incur if you are a mobile detailer, wages should you ever hire employees, and other day to day expenses.

Writing off equipment like polishers, steamers, extractors and other high dollar items may be a little more difficult since they may need to be depreciated over 5 (or is it 7?) years. However the tax code may let you Section 179 depreciation which allows to recognize all of the depreciation expense in the year of purchase. Check with a CPA for the rules of Sec 179 depreciation, I don't recall all of them at the moment.
 
Re: Question about Tax Deductions for detailing.

LLC, keep records, records, records the mile rate is like 55 cents so get a book

& record every mile.
 
Re: Question about Tax Deductions for detailing.

The reason to incorporate (S-Corp) or LLC is primarly the protection benefits. As a sole prop you are using your Social Security for recording purposes and working as yourself. Might consider looking into liability insurance and study the main differences from a protection standpoint.
 
Re: Question about Tax Deductions for detailing.

LLC, every biz I have is under an LLC, always keep the business a separate legal entity as it'll have its own EIN and not your social. SP is ok if your just starting but 99% of the time ends up transferring to corporation, may as well do that first anyway. There's really no advantage to an SP, little easier to file taxes and few other minor things that are no big deal. As far as expensing items, I don't have a detail business so have no idea how it would work, talk to a CPA, if its like almost any other business with equipment used as such, would assume they'd be depreciated and not immedietley written off/reimbursed.
 
Last edited:
LLC. ^^^ This. When you have an LLC if something were to happen and someone were to sue you they would only be able to take you for what your company is worth not what you are worth.
 
You must log in or register to reply here.
Back
Top