Lease or Own Car Wash Property

[SuperSuds04]

I've owned my car wash for a little under 5 years now, my 5 year lease is coming up and I'm buying the property. After seeing some posts on here and talking with fellow car wash owners it got me interested to know do majority of carwash owners lease where they are or do they own the property? And for those of you that do own do you hold it under a separate business to rent it back from yourself for the deductions on the business front or do you just have it all under one name?

 

[Greg_T]

We own the property, all under the same business entity.

 

[SuperSuds04]

We own the property, all under the same business entity.

What is the benefit of doing that vs owning under a separate entity to use rent as an operating expense?

 

[Greg_T]

What is the benefit of doing that vs owning under a separate entity to use rent as an operating expense?

We're in Australia, so as far a I know there are no benefits to spitting the property and business over here.

 

[SuperSuds04]

We're in Australia, so as far a I know there are no benefits to spitting the property and business over here.

Ahh I apologize I should've looked at your location. I'm stateside, I appreciate it!

 

[MC3033]

Most here own. I don’t see many benefits in leasing unless you are dipping your toes in and trying to hedge some risk.

I know a few who hold the operating business and real estate in separate companies. I’d be curious what kind of circumstances those are and what kind of savings there are (do these people file their own tax returns and related items to save on fees of having another business)

 

[HeyVern]

know a few who hold the operating business and real estate in separate companies. I’d be curious what kind of circumstances those are and what kind of savings there are (do these people file their own tax returns and related items to save on fees of having another business)

A big reason for separating the wash from the holding company is protection from lawsuits. If something happens and somebody sues the wash, the wash doesn't own anything so there is nothing for them to take if they win the suit.

 

[Kar B Kleen]

A big reason for separating the wash from the holding company is protection from lawsuits. If something happens and somebody sues the wash, the wash doesn't own anything so there is nothing for them to take if they win the suit.

That is precisely why.

 

[Earl Weiss]

do majority of carwash owners lease where they are or do they own the property? And for those of you that do own do you hold it under a separate business to rent it back from yourself for the deductions on the business front or do you just have it all under one name?

Lease 2 , own 2.
Owned property under one entity . Operating entity under another. Operations lease from property. Insulates property from liability. Separate EIN and bank accounts a must. Consult your lawyer and tax adviser.

 

[Earl Weiss]

I know a few who hold the operating business and real estate in separate companies. I’d be curious what kind of circumstances those are and what kind of savings there are (do these people file their own tax returns and related items to save on fees of having another business)

If property ownership is single person LLC or even 2 people even with a seperate EIN a schedule can be filed with the person(s), tax return. No Separate return required. Consult your tax adviser.