What's new

Taxes

jayjohn

New member
Joined
Feb 17, 2023
Messages
1
Reaction score
0
Points
1
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

Active member
Joined
Feb 26, 2014
Messages
338
Reaction score
83
Points
28
Location
IL
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.
 
Last edited:

Greg Pack

Wash Weenie
Joined
Sep 3, 2007
Messages
4,095
Reaction score
1,718
Points
113
Location
Hoover, Alabama
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

Active member
Joined
Feb 26, 2014
Messages
338
Reaction score
83
Points
28
Location
IL
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

Well-known member
Joined
Aug 4, 2014
Messages
740
Reaction score
408
Points
63
Location
Ft. Worth
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

Well-known member
Joined
Aug 30, 2007
Messages
16,667
Reaction score
3,933
Points
113
Location
Texas
Someone used to sell bad weather insurance. I don't know how you could possibly deduct a lack of income.
 

traveler17

Well-known member
Joined
Nov 5, 2019
Messages
791
Reaction score
591
Points
93
Location
SE NC
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

Well-known member
Joined
Nov 8, 2017
Messages
3,260
Reaction score
1,160
Points
113
Location
Ohio
He probably meant that there are not any unique to the industry deductions and that would be correct.
 

sparkey

Active member
Joined
May 22, 2010
Messages
901
Reaction score
182
Points
43
Location
Ohio
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

Well-known member
Joined
Aug 30, 2007
Messages
16,667
Reaction score
3,933
Points
113
Location
Texas
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

Active member
Joined
Feb 26, 2014
Messages
338
Reaction score
83
Points
28
Location
IL
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. :unsure:
 

OurTown

Well-known member
Joined
Nov 8, 2017
Messages
3,260
Reaction score
1,160
Points
113
Location
Ohio
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

Well-known member
Joined
Nov 5, 2019
Messages
791
Reaction score
591
Points
93
Location
SE NC
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

Member
Joined
May 30, 2012
Messages
69
Reaction score
23
Points
8
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.
 
Top