Please_Be_Green
09-04-2008, 10:12 AM
I’m thinking about starting a small operation, an operation, which I’m hoping can break-even in year one and turn a ‘small’ profit in year 2. Ultimately off-setting equipment purchases for my own long term use. ( i.e. Toro Z340)
This year, I’ve been intrigued in studying turf grasses, weeds, diseases and lawn maintenance in pursuit in up-keeping my home lawn. I’ve been reading everything I can get my eyes on over the internet and have even thought about attending a 3 week seminar through a university in Turf Care Management. All I can say is it’s amazing how much there is to learn.
What also amazes me is that it seems as everyone on my block, but myself, has a lawn service cutting their lawn. Most of my new neighbors at some point this year have complained about a “missed” cut due to weather related issues. In the same breath made a comment how good my lawn looks. (Because I’m cutting every 3-5 days’ during the growing season and am not relying on someone else’s ‘schedule’.)
So… I’ve been thinking purchasing a Toro Z340 and getting a couple of accounts to off-set the cost… I’ve mentioned it to 3 of my neighbors and they have all said that if I wanted to cut their lawns next year, they’d be more than happy to pay me for lawn service. So I think I could potentially have 3 clients already and would be surprised if another 2 wouldn’t quickly jump on board. So, I could potentially be cutting 6 properties including my own, 3 on one side, and 3 on the other side of the street. All 1/3 flat acre lots, minimal obstacles and approx 10ksq/ft of turf to cut and trim. I’ve watched their lawn services cut and finish in 15-20 or so minutes with their commercial grade ZTR’s. (Granted 2 man teams with trimming happening simultaneously.) Currently it takes me 1 hour to cut and trim my own property with a 21" residential snapper.
Anyway, I guess my question really is about “Accounting” of the business and depreciation of equipment.
Let’s assume I have 5 clients, each paying $200/ month, 7 months a year, total $1400.00 per property. Grossing $7,000.00 which does get reported as additional small business income.
Let’s also assume I purchase a Toro Z340 for $6,000.00
Assume Section 179 tax code doesn’t change for 2009.
For my 2009 tax filing, after applying Section 179 depreciation of equipment, I’d only have $1000.00 as taxable income and my ZTR would have been paid for.
I'm not missing anything, am I? Seems simple enough.
This year, I’ve been intrigued in studying turf grasses, weeds, diseases and lawn maintenance in pursuit in up-keeping my home lawn. I’ve been reading everything I can get my eyes on over the internet and have even thought about attending a 3 week seminar through a university in Turf Care Management. All I can say is it’s amazing how much there is to learn.
What also amazes me is that it seems as everyone on my block, but myself, has a lawn service cutting their lawn. Most of my new neighbors at some point this year have complained about a “missed” cut due to weather related issues. In the same breath made a comment how good my lawn looks. (Because I’m cutting every 3-5 days’ during the growing season and am not relying on someone else’s ‘schedule’.)
So… I’ve been thinking purchasing a Toro Z340 and getting a couple of accounts to off-set the cost… I’ve mentioned it to 3 of my neighbors and they have all said that if I wanted to cut their lawns next year, they’d be more than happy to pay me for lawn service. So I think I could potentially have 3 clients already and would be surprised if another 2 wouldn’t quickly jump on board. So, I could potentially be cutting 6 properties including my own, 3 on one side, and 3 on the other side of the street. All 1/3 flat acre lots, minimal obstacles and approx 10ksq/ft of turf to cut and trim. I’ve watched their lawn services cut and finish in 15-20 or so minutes with their commercial grade ZTR’s. (Granted 2 man teams with trimming happening simultaneously.) Currently it takes me 1 hour to cut and trim my own property with a 21" residential snapper.
Anyway, I guess my question really is about “Accounting” of the business and depreciation of equipment.
Let’s assume I have 5 clients, each paying $200/ month, 7 months a year, total $1400.00 per property. Grossing $7,000.00 which does get reported as additional small business income.
Let’s also assume I purchase a Toro Z340 for $6,000.00
Assume Section 179 tax code doesn’t change for 2009.
For my 2009 tax filing, after applying Section 179 depreciation of equipment, I’d only have $1000.00 as taxable income and my ZTR would have been paid for.
I'm not missing anything, am I? Seems simple enough.