Power Washing and Roof Cleaning Forum

DirtyRoofcom · Approved Exterior Cleaner

Capital improvement??

BlueRidge · Approved Exterior Cleaner

I can't comment about NY but we never charge tax because it is a service. No tax on labor. We pay taxes on our products which makes it end user. There is no tax upon a tax. We already paid it. If you are tax exempt and don't pay taxes on product then it's a different story.

Fred W · Guru

BlueRidge wrote:
I can't comment about NY but we never charge tax because it is a service.

+1

tjteed · Approved Exterior Cleaner

What did accountant say. its different in every state. In MD there is sales tax on commercial pressure washing but none on residential.

Patrick G · Approved Exterior Cleaner

Mine said charge tax it is not home improvement.

Bryan P · Approved Exterior Cleaner

BlueRidge wrote:
I can't comment about NY but we never charge tax because it is a service. No tax on labor.

I'm sure it's a state by state thing. I have TWO service businesses. One services REAL property (Houses, land, etc.), the other services Tangible Personal Property (like toasters or guns). I have to charge tax on labor for tangible personal property, but not on real property. I understand it's because people pay property tax on their houses, but not their personal items.

I don't know the law either, but it seems calling an exterior cleaning a capital improvement is a huge stretch.

Fred W · Guru

In Louisiana it has nothing to do with it being Real Property. Louisiana does not have a tax on professional services.......of which we are.

Honestly everything is taxed more than once anyhow.

1. You get taxed on your wages = tax paid
2. You get taxed when you by something at the store or for gas when you purchase it with the money that was already taxed.

John Aloisio · Approved Exterior Cleaner

In New Jersey we have a tax for the tax we charge and you get charged for mentioning the word "tax". I just had to pay 47.40 for saying it three times in this post. biggrin

BlueRidge · Approved Exterior Cleaner

Baton Rouge Roof Cleaner wrote:
In Louisiana it has nothing to do with it being Real Property. Louisiana does not have a tax on professional services.......of which we are.

Honestly everything is taxed more than once anyhow.

1. You get taxed on your wages = tax paid
2. You get taxed when you by something at the store or for gas when you purchase it with the money that was already taxed.

One of my most disliked words and you put it exactly as it is! I could go on and on about how our tax systems are not what our founding fathers envisioned but then I would bore most of you and there is little I can do about it alone. I would also get off topic with the original post. The FairTax would start to fix a lot of the problems!

A service is not a product. If I purchased product and was tax exempt then I would have to charge a sales tax only on the product.

I'm sorry NJ hit you for just posting John!

DirtyRoofcom · Approved Exterior Cleaner

as i understand it ( in NY) if its a service you collect tax. if were cleaning a roof there's tax if were replacing the roof there is not.

major remodeling projects are capital improvements repairs and maintenance are not.

Accountant said its not a capital improvement but to have the customer sign the form anyway and submit it. that switches the responsibility to them not us.

mikepas · Exterior Cleaner

I live in NY, It's Not a capital improvement, you are responsible for the tax if you don't collect it.

CALL THE THE NY TAX DEPARTMENT AND VERIFY. See if you can get them the send you a statement on cleaning or some official document.

IRS clarifies capital improvement vs repair expense?

The following table summarizes many of the factual considerations used by the courts. These factors, although not exhaustive, should be considered in your analysis to distinguish between capital expenditures and deductible repairs.

Capital	Repair
Improvements that "put" property in a better operating condition	Improvements that "keep" property in efficient operating condition
Restores the property to a "like new" condition	Restores the property to its previous condition
Addition of new or replacement components or material sub-components to property	Protects the underlying property through routine maintenance
Addition of upgrades or modifications to property	Incidental Repair to property
Enhances the value of the property in the nature of a betterment
Extends the useful life of the property
Improves the efficiency of the property
Improves the quality of the property
Increases the strength of the property
Increases the capacity of the property
Ameliorates a material condition or defec
Adapts the property to a new use
Plan of Rehabilitation Doctrine

tjteed · Approved Exterior Cleaner

Does it matter? I thought most guys worked for cash in Long Island

Maverick Contracting · Approved Exterior Cleaner

If you work on the Uber estates (20 mil ) like we do cover your arse l and report everything!
HACKS need not apply
People who work for cash are usually not professionals

Michael Wedge · Approved Exterior Cleaner

Same here John. I just got taxed for replying to your reply on taxes

DirtyRoofcom · Approved Exterior Cleaner

tjteed wrote:
Does it matter? I thought most guys worked for cash in Long Island

Tim im not sure I understand your point.

tjteed · Approved Exterior Cleaner

Just trying to be funny. A lot of guys working off the books in Long Island anything trade related.