Your industry worksheet
Mechanic-Auto-Body (PDF, 135 kb)
Our P&L worksheet for your profession.
Tool deductions
Hand tools under $2,500 can be expensed immediately; power tools and larger equipment depreciate or qualify for Section 179. Keeping a tool log matters in an audit.
Section 179 for shop equipment
Lifts, alignment racks, paint booths, welders, and diagnostic equipment all qualify for Section 179 up to annual limits, plus bonus depreciation. Timing purchases with income matters.
Have a specific situation?
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Parts inventory
Shops with meaningful parts inventory need a consistent accounting method (specific identification, FIFO, or LIFO) and year-end inventory counts. This is usually where shop bookkeeping gets loose.
Common questions
- Can I deduct the tool box my employer requires?
- W-2 employees can't deduct unreimbursed tools through 2025. Shop-owner operators and self-employed techs can.
- What's the best way to handle a multi-bay shop?
- Usually an S-corp with W-2 wages to the owner-operator plus distributions. We model the reasonable salary analysis specific to the shop's income.