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#1 |
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Member
Trade: Painter, plaster repair
Join Date: Apr 2006
Posts: 31
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Materials Or Tools?
I have recently entered the wonderful world of doing my own taxes on my small painting business that I just opened. So I am wondering about what count's as a tool and what is a material?
For instance I repair some plaster, obviously I can't write off the cost of the plaster, but can I write off a sanding block that I use? Since it only lasts until I sand this wall, is that a tool? or a material? Or how about paint rags? or Tray liners? Even things like bags for a shop vac? There are some other's that I am blanking on, but I was wondering is there a standard out there that I need to stick to? |
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#2 | |
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My custom title
Trade: Painting, faux, rock, plaster, texture, tile, laminates, finish carpentry contractor
Join Date: Jul 2006
Location: Tallahassee, FL
Posts: 1,559
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Re: Materials Or Tools?
Sundries need to be kept track of, materials are your loss and need to be kept track of... though i'm not a tax expert my gal tells me I can write of part of my whites (uniforms), sundries, enter materials as job costs (loss) and depreciate all my equipment each year... even if it's paid for... not to mention lights, insurance, trucks.......
My advice? Get a tax gal.
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#3 | |
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...jammin
Trade: Rock Disciple
Join Date: Jun 2005
Location: Cape Cod, Massachusetts
Posts: 5,235
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Re: Materials Or Tools?
Those are sundries or consumables
Not tools Hire a tax pro I know, I know, "I can't afford one" Wrong You can't afford not to have one
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#4 |
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Pro
Trade: Painting Contractor
Join Date: Jan 2007
Location: SW Suburban Chicago
Posts: 610
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Re: Materials Or Tools?
Don't be afraid of the tax man, his bark is bigger than his bite.
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#5 | |
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Member
Trade: Painter, plaster repair
Join Date: Apr 2006
Posts: 31
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Re: Materials Or Tools?Quote:
Like paying taxes quaterly. anywebsites out there you would recommend? The IRS website explains stuff okay, but thats about it. I may get a tax gal, but I am going to give this a try. |
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#6 |
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Systems Fanatic
Trade: Painting
Join Date: Jun 2004
Location: Houston, TX
Posts: 415
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Re: Materials Or Tools?
There are a couple of ways to account for such things. You can depreciate the expense, or simply expense it. Depreciation is a total pain, and really isn't reasonable for small hand tools. My advice (and my CPA's) is to expense it at purchase.
I agree with the others who suggest getting a tax expert. It's worth the money and can save you a ton of time. (And time is money.) Brian Phillips |
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#7 |
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Mike Danahy
Trade: Signature Painter
Join Date: Oct 2006
Location: Ontario
Posts: 670
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Re: Materials Or Tools?
Around here there are assets that depreciate, which includes tools over ($100 - $200), everything else gets used up immediately as materials, or direct expense to the job...
May get alittle funny, should you decide to pre-purchase a ton of materials, and have to carry that as inventory.... blah.... Unless you're saving a significant amount, I wouldn't bother with that... |
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#8 | ||
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...jammin
Trade: Rock Disciple
Join Date: Jun 2005
Location: Cape Cod, Massachusetts
Posts: 5,235
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Re: Materials Or Tools?Quote:
However, you'll still want a pro to do the taxes And you'll need a pro to set up QB (unless you are reasonably skilled with accounting and/or accounting software programs)
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