Taxes

[jayjohn]

Hello
I am new to the car wash industry
And I am trying to see what are the tax deductions i get in a carwash
I asked my accountant and he was like there is not much
Are rainy days considered tax deductions ? And giving away free washes also considered tax deductions?

 

[Overachiever]

The way it works for me is any expense is tax deductible.. so giving away free washes will end up being a tax deduction based on the cost of my chemicals, utilities, maintenance costs. So in other words the more money you spend on car wash related things like upgrading, repairing, inventory, building out your tool collection, etc the less you'd pay in taxes.

Oh forgot to mention home office, cell phone, storage units, travel to and from the car wash, traveling to car wash expos, stuff like that you can deduct as well.

 

[Greg Pack]

As I understand it free washes are not deductible because you didn't receive any money for them, so it just reduces your net. Rainy days just also reduce your gross and net revenue so no deductions there.

You can depreciate the building and land over 15 years instead of the usual longer terms for general purpose property. That is probably the big one in this business that many CPAs may not know about.

 

[Overachiever]

As I understand it free washes are not deductible because you didn't receive any money for them, so it just reduces your net. Rainy days just also reduce your gross and net revenue so no deductions there.

Yeah that is what I meant to say, was trying to say something a long the lines of if you give away 1000.00 worth of soap and utilities costs you can deduct that, but you can't be like I gave away 1000 $20 car washes, so give me a $20k tax deduction.

 

[Rfreeman]

Hello
I am new to the car wash industry
And I am trying to see what are the tax deductions i get in a carwash
I asked my accountant and he was like there is not much
Are rainy days considered tax deductions ? And giving away free washes also considered tax deductions?

Sounds like you need a new accountant

 

[MEP001]

Someone used to sell bad weather insurance. I don't know how you could possibly deduct a lack of income.

 

[traveler17]

Hello
I am new to the car wash industry
And I am trying to see what are the tax deductions i get in a carwash
I asked my accountant and he was like there is not much
Are rainy days considered tax deductions ? And giving away free washes also considered tax deductions?

Your accountant said “there’s not much tax deductions???? “ That’s when I would have got up, shook his hand and said thanks anyway

 

[OurTown]

He probably meant that there are not any unique to the industry deductions and that would be correct.

 

[sparkey]

The way it works for me is any expense is tax deductible.. so giving away free washes will end up being a tax deduction based on the cost of my chemicals, utilities, maintenance costs. So in other words the more money you spend on car wash related things like upgrading, repairing, inventory, building out your tool collection, etc the less you'd pay in taxes.

Oh forgot to mention home office, cell phone, storage units, travel to and from the car wash, traveling to car wash expos, stuff like that you can deduct as well.

I would be interested to know how many people actually deduct the mileage from their home to their carwash? The IRS says your not suppose to deduct this mileage. I have had accountants tell me if you have a home office its easier to justify this mileage.

 

[MEP001]

I would be interested to know how many people actually deduct the mileage from their home to their carwash? The IRS says your not suppose to deduct this mileage. I have had accountants tell me if you have a home office its easier to justify this mileage.

I do because I cross county lines. I deduct all vehicle expenses.

 

[Overachiever]

I would be interested to know how many people actually deduct the mileage from their home to their carwash? The IRS says your not suppose to deduct this mileage. I have had accountants tell me if you have a home office its easier to justify this mileage.

My accountant originally told me I could only deduct mileage from my full time job to the car wash, but once I became a remote employee due to covid he said I could deduct from my house to the wash.

 

[OurTown]

I would be interested to know how many people actually deduct the mileage from their home to their carwash? The IRS says your not suppose to deduct this mileage. I have had accountants tell me if you have a home office its easier to justify this mileage.

We deduct mileage from home to the wash but we also have a home office. Even without it I don't understand why you couldn't. It is a needed drive there to run your business so it should be a legit expense.

 

[traveler17]

I would be interested to know how many people actually deduct the mileage from their home to their carwash? The IRS says your not suppose to deduct this mileage. I have had accountants tell me if you have a home office its easier to justify this mileage.

We deduct mileage

 

[JustaGuy]

We deduct mileage from home to the wash but we also have a home office. Even without it I don't understand why you couldn't. It is a needed drive there to run your business so it should be a legit expense.

According to the IRS, you can only deduct mileage after arriving at work or first business destination. So, with a home office, it's possibly legitimate (you arrive at home office, making it your first business destination, then go to a site). But otherwise, you only get to deduct mileage once you arrive at a site when you leave to go pick up parts, go to another site, etc. (but not back home, unless, again, you have a home office.)

As always, check with your accountant. I'm not an accountant or lawyer so this is just my personal understanding, not professional advice.