tax writeoff?

K

krzdimond

New member
I just became legal and stated a business last Feb. and I have a question. I put magnetic signs on my car.... advertising. Essentially it's a rolling billboard. Question is, how do I write off the details I do on my own vehicle? ( can't sell detailing with a dirty vehicle:cool:) I'm sure I can't charge myself the retail rate (doing business as DBA)



Anyone know how to go about this?
 
krzdimond said:
I just became legal and stated a business last Feb. and I have a question. I put magnetic signs on my car.... advertising. Essentially it's a rolling billboard. Question is, how do I write off the details I do on my own vehicle? ( can't sell detailing with a dirty vehicle:cool:) I'm sure I can't charge myself the retail rate (doing business as DBA)



Anyone know how to go about this?
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The details you do on your work vehicle(s) would be considered normal maintenance costs. Your maintenace write off would be the cost of materials used to detail the work vehicle(s) along with the wages you paid anyone to help you clean your work vehicle(s). Most of these material costs you will probably already capture in your supplies expense and wage expense (if any) so you probably would not need to come up with a seperate amount for your own work vehicle(s).
 
In most cases the standard mileage deduction is going to be worth (far) more than trying to itemize a bunch of small stuff.



IRS said:
Beginning on Jan. 1, 2009, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:



55 cents per mile for business miles driven
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I don't think you can charge your "labor" as a business expense.



Sure, you can/would charge all your purchased materials/supplies as part of the cost of doing business.
 
It depends on if you are using the standard (mileage) deduction or the actual expense method. If you are using the actual expense method, I do not see why you could not deduct it as a maintenance expense. Just write the expense for the amount you would charge someone for the service.
 
I was told the vehicle needs to be a dedicated one for the business, one you purchased for the business. I'm under the impression you cannot just start writing off your vehicle costs.



Cheers,

GREG
 
Greg Nichols said:
I was told the vehicle needs to be a dedicated one for the business, one you purchased for the business. I'm under the impression you cannot just start writing off your vehicle costs.



Cheers,

GREG
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You can, but the deduction is related to the percentage that the vehicle is used for business. That is why the standard (mileage deduction) is so much easier.
 
Thanks for the info...



I am the sole employee and I was going to/ already deducted the supplies, just didn't know if I can writeoff the retail cost (what I would charge) as that would essentially double my deduction.



I also work out of my house right now... not mobile...yet. I am also deducting a % of the utilities for the house (1400 square foot house - 200 square foot garage = 7% deduction for business use) Best part? The garage is not listed in the published square footage od the house as it's (was) not heated.
 
brwill2005 said:
It depends on if you are using the standard (mileage) deduction or the actual expense method. If you are using the actual expense method, I do not see why you could not deduct it as a maintenance expense. Just write the expense for the amount you would charge someone for the service.
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Better hope you don't get audited if you do so. If he were in the US, there is NO way Paul Dalton would be allowed to write of $5,000 (or whatever he charges) for detailing his work van.
 
Better be careful. If you start trying to claim vehicle or your house/garage as a business cost you can set yourself up for potential audit problems. You can only claim a vehicle for the percentage it is used for business....not taking kids to school, buying groceries, etc. If you are claiming 100% (highly recommend you don't) of your garage as business then you are implying that you don't use it for storage for household tools, supplies, etc. If you take full depreciation on your garage based on a set period of time and then get out of the business say 5 years later then you will probably owe for depreciation recapture. It can get complicated in a hurry.



Keep it simple and it will be a lot easier. If you start claiming too much you may be astounded by the recordkeeping required to verify your claims.....or you might get lucky and get away with it. The bottom line is ignorance of tax law won't carry much weight with the IRS. Just because John Doe has been doing it for 10 years without a problem doesn't mean that method is correct.
 
bert31 said:
Better hope you don't get audited if you do so. If he were in the US, there is NO way Paul Dalton would be allowed to write of $5,000 (or whatever he charges) for detailing his work van.
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I am not an accountant or a tax lawyer; are you? I said nothing about deducting $5000 per detail. I think if he keeps it reasonable, he should not have a problem. Again, this is only if he is using the actual expense method. I use the mileage deduction, so things such as vehicle maintenance are built into that deduction.
 
krzdimond said:
Thanks for the info...



I am the sole employee and I was going to/ already deducted the supplies, just didn't know if I can writeoff the retail cost (what I would charge) as that would essentially double my deduction.



Expenses are charged as actual.



I also work out of my house right now... not mobile...yet. I am also deducting a % of the utilities for the house (1400 square foot house - 200 square foot garage = 7% deduction for business use) Best part? The garage is not listed in the published square footage od the house as it's (was) not heated.
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Make sure you learn about "recapture" when you start the home depreciation routine ;)
 
tom p. said:
In most cases the standard mileage deduction is going to be worth (far) more than trying to itemize a bunch of small stuff.
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10,000 or so miles a year here. I guess that is the advantage of a large metro area like the DFW area.



I office out of my home but I can't deduct that because all the actual work is done on site and not here. Stuff like advertising, website hosting, business cell phone/business land line + Yellow Page listings, detailing product and supplies, etc are all legitimate write-offs. Cleaning your own vehicle is not.
 
Scottwax said:
10,000 or so miles a year here. I guess that is the advantage of a large metro area like the DFW area.



I office out of my home but I can't deduct that because all the actual work is done on site and not here. Stuff like advertising, website hosting, business cell phone/business land line + Yellow Page listings, detailing product and supplies, etc are all legitimate write-offs. Cleaning your own vehicle is not.
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i think scott just summed this one up!
 
Scottwax said:
Stuff like advertising, website hosting, business cell phone/business land line + Yellow Page listings, detailing product and supplies, etc are all legitimate write-offs. Cleaning your own vehicle is not.
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Thank you sir.



So far I am annotating all of the above. I just wondered if I could write off the detail as an advertising expense because of the signs and c'mon, would you hire a detailer with a dirty vehicle?:laugh:



I can't afford a CPA right now, so all of the info is appreciated!



This is why I asked those that do.



Thanks again guys





Robert
 
The best thing to do is download a blank Schedule C (IRS website) and review the various categories you should be considering as applicable to your business.
 
krzdimond said:
I just became legal and stated a business last Feb. and I have a question. I put magnetic signs on my car.... advertising. Essentially it's a rolling billboard. Question is, how do I write off the details I do on my own vehicle? ( can't sell detailing with a dirty vehicle:cool:) I'm sure I can't charge myself the retail rate (doing business as DBA)



Anyone know how to go about this?
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You must be itchin for an AUDIT...
 
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