Legal Disclaimer: This article is written for informational purposes only and does not constitute professional financial advice. Please reference section179.org and a professional accountant for advice on financial planning and filing taxes.
As 2020 comes to an end, you might be thinking about all of this year's expenses and wondering what you might be able to write off on your taxes. You may even be considering whether or not to make a big purchase, weighing the tax deductions you could get if you bought it this year versus next.
Is it worth buying that new lift before the year ends? Or should you put it off until 2021?
What is Section 179?
Section 179 of the IRS tax code allows business owners to write off the entire cost of a piece of equipment, renovations, or other assets in the first year instead of writing off an asset a little bit at a time over a five, seven, fifteen, or thirty-nine year period. To give an example, if a shop owner buys a new tire machine, they could either write off the taxes over a seven-year period, or they can use Section 179 to get the entire deduction in the first year.
What Type of Costs Qualify for Section 179?
Tangible business property, including machinery and equipment
Leasehold improvements
Computer software*
*Is Tekmetric Eligible for Section 179?
Generally speaking, off-the-shelf computer software that has been purchased outright is eligible for Section 179. Because Tekmetric is a web-based software and does not make users sign a contract, it is not eligible for section 179, but it does qualify for a standard tax deduction.
What are Leasehold Improvements?
Leasehold improvements are any repairs or modifications that you make to your building or property, including adding a new roof, installing security or safety systems, and remodeling parts of your building without expanding the footprint. Without Section 179, leasehold improvements depreciate over 15 or 39 years, depending on what the improvements are. With Section 179, you can receive the entire deduction in the first year.
How Often Does Section 179 Change?
Section 179 is typically adjusted every several years. Most recently, Section 179 was adjusted in 2018 when the deduction limit was doubled and more types of purchases were made eligible. Section 179 may change again in the following years.
When Should You Use Section 179?
If you know that you’re going to pay taxes this year, and you have made a major qualifying purchase, then you may want to consider using Section 179 to save on your taxes and free up some cash flow for 2021.
If you financed a major purchase, you may want to consider how soon you plan on paying off that purchase and whether or not you would like to receive a tax deduction in the following years as you pay it off. For example, if you have a loan on a piece of equipment that you plan on paying over five or ten years, you may want to opt for the regular depreciated tax reduction so that you have money to offset those taxes in the following years.
Should You Make a Major Purchase Before the Year Ends to Use Section 179?
It’s not the wisest decision to buy something just to save money. It is true that Section 179, and tax benefits in general, are the best that they’ve been in years, but consider only making a major purchase if it is already in your plan and budget. If it is something that you already planned on buying in the next six months, then you may want to make the purchase before the end of the year to leverage Section 179’s tax deductions.
Talk to the Auto Repair Accounting Experts
Every situation is different. Take a look at what your tax rates are and ask yourself, "Is my income low enough this year where I'm actually reducing taxes at a pretty low rate? What do I think the tax rates are going to be in the future? Or will this benefit me more in the coming years when I think I'll be making more money?"
Talk to your accountant to form a game plan for all of this.
This article was written with the guidance of automotive repair industry CPA Hunt Demarest of Paar, Melis, & Associates, P.C.
Need help planning your taxes for 2020? Contact Paar, Melis, & Associates.
The holiday season is now in full swing, and as a shop owner, you’re probably thinking about how to best lead your team during this time.
Between the hot chocolate and the carols, there will be a lot you’ll have to navigate, including holiday pay and time-off requests.
By preparing and leveraging auto repair shop management software, all of this can be a piece of cake (or pie, if that’s your holiday dessert of choice).
If you're running an auto repair shop, investing in a car lift is essential. A high-quality vehicle lift makes it easier to work on cars, increases efficiency, and ensures safety. But how much does it actually cost to install a car lift? That depends on the type of lift, installation costs, and other factors such as weight capacity and safety features. Let’s break it all down so you can pick the best automotive lift for your needs.
Do you need a car lift?
Car lifts are essential in auto repair shops because they provide mechanics with better access to a vehicle’s undercarriage, making inspections, repairs, and maintenance tasks safer, more efficient, and more comfortable. Unlike floor jacks, lifts offer a stable and elevated workspace, reducing the risk of injuries and improving workflow.
With a car lift, technicians can quickly perform tasks such as oil changes, brake repairs, exhaust system work, and suspension adjustments without having to crawl under the vehicle. This efficiency leads to faster turnaround times and higher shop productivity.
Additionally, lifts help maximize shop space by allowing vertical storage for vehicles, which is especially useful in high-volume repair shops. Overall, car hoists are a fundamental investment for any auto repair shop looking to enhance efficiency, safety, and the quality of service provided to customers.
Types of car lifts and their costs
Each type of lift has its pros and cons. Some lifts are better for oil change shops and some are better for tire or repair shops. In general, car lifts can cost between $1,000 and $20,000 depending on brand, lift capacity, lift height, and features. Here’s a comprehensive look at the most common lift options for your shop.
Two-Post car lifts
A two-post car lift is one of the most popular choices for auto repair shops. They are popular because they take up less space and can be affordable depending on features. Make sure to plan out your shop layout as these lifts are permanent and cannot be easily moved. These hoists come in asymmetric and symmetric configurations, allowing flexibility based on vehicle type.
Price: $3,000 - $10,000
Best For: General repair shops working on SUVs and smaller cars.
Lift capacity: 5,000 - 10,000 lbs.
Popular brands: BendPak, Rotary, Tuxedo.
Advantages: High lifting capacity while saving space for smaller shops.
Four-Post lifts
A four-post lift provides greater stability and weight capacity, making it ideal for heavier vehicles. If your shop works on a lot of trucks or heavy-duty vehicles, the four-post lift might be the best lift for you. Tire and brake shops should avoid these lifts as the tires sit on the lift making it difficult to work on these areas.
Price: $5,000 - $25,000
Best For: Dealerships and professional shops.
Lift capacity: 7,000 - 14,000 lbs.
Popular brands: BendPak, Titan, Tuxedo, Rotary.
Advantages: Heavier lifting capacity for larger vehicles.
Scissor lifts
If saving space is your top priority, the scissor lift may be your best option. They are almost invisible when not in use and lie flat on the ground to optimize garage space. Double check the lift capacity and height to make sure it can accommodate the types of vehicles you work on.
Price: $1,500 - $10,000
Best For: Quick repair shops where space is limited.
Lift capacity: 5,000 - 15,000 lbs.
Brands: QuickJack, BendPak, MaxJax
Advantages: Compact and cheaper.
In-Ground lifts
In-ground car lifts are a great choice for shops that work on heavier vehicles and want to save space. These lifts are the perfect balance of the space saving capabilities of a scissor lift while also providing optimal strength for large vehicles.
Price: $10,000 - $25,000
Best For: Repair shops and dealerships.
Lift capacity: 5,000 - 20,000 lbs.
Brands: BendPak, Rotary, Atlas
Advantages: Compact while also offering enough muscle.
Portable car lifts
If your shop layout frequently changes or you are a mobile mechanic, a portable lift may be the best option. These lifts can be easily moved around a garage or taken to a job site and are often the cheapest option. However, they can be less reliable and don’t provide the same level of strength as a stationary lift.
Price: $500 - $5,000
Best For: Home garages, mobile mechanics, DIY enthusiasts.
Lift capacity: 5,000 - 10,000 lbs.
Brands: QuickJack, MaxJax
Advantages: Affordable, compact, mobile.
Installation prices for car lifts
Installing a vehicle lift is not just about purchasing the unit. You also need to consider the installation costs, which can vary depending on the type of lift and garage setup. Here are the main factors affecting installation costs:
1. Concrete requirements
Most lifts, especially two-post car lifts and four-post lifts, require a thick concrete base. If your floor isn’t thick enough, you may need reinforcement, which adds to the cost.
2. Electrical setup
Lifts need power, and if your garage isn’t wired for it, you’ll need an electrician.
3. Air compressors & accessories
Some lifts require compressors and additional balancer tools for operation.
4. Professional installation
Hiring a pro ensures the lift is ALI-certified and meets safety regulations.
Choosing the right car lift for your auto repair shop
Each type of lift comes with its own advantages, making it important to choose the right one based on your needs. Here are some things to consider when making your decision:
How big is your shop?
Which repair services do you offer?
What is your budget?
Does the lift offer a warranty?
Will you garage layout change over time?
How important is a car lift warranty to you?
How heavy will the vehicles you work on be?
What is the average review rating of the lift?
How easy or hard is the lift to install?
How much will the maintenance cost?
Final thoughts
Installing a vehicle lift in your auto repair shop is a smart investment. Whether you choose a two-post car lift, scissor lifts, or portable lift, knowing the lift cost and installation costs upfront can help you budget wisely. Whatever you choose, ensure it’s ALI-certified for safety and performance. Lastly, don’t forget about regular maintenance and safety inspections to ensure your lift continues to run for many years.
Tekmetric just revealed two new tools to help shops win more customers and run a more efficient front desk. Get the full story. Watch the on-demand webinar now.
Generating new business in auto repair is hard. The industry is projected to grow just 2% over inflation annually over the next five years. The average American has 15 auto repair shops within 10 miles of their home, according to Tekmetric's internal data, meaning competition for every new customer is fierce. And across multiple industry surveys, roughly two-thirds of drivers say they don't fully trust their local repair shop — making it that much harder to win them over. The result: only one in 10 shops both grows and hits profit margins of 20% or higher.
"We know the competition to win new customers is fierce,” said Lauren Langston, president and COO, Tekmetric. “That means we need the right strategies and the right tools in order to do it."
Tekmetric's data shows that winning shops consistently focus on four outcomes: car count, average repair order (ARO), driver experience, and cycle time. Two new Tekmetric products — Tekmetric Digital Ads and Tekmetric Phones — are built to move the needle on all four.
Tekmetric Digital Ads
Winning new customers starts with being found. Tekmetric Digital Ads is an AI-powered add on that helps your shop show up where high-intent drivers are already searching for auto repair on Google Maps and Apple Maps. Because it connects directly to Tekmetric, you can see exactly how your ad spend translates into real revenue, not just clicks.
"It's really hard to see what's working. One of the superpowers of this product is that it's connected directly with Tekmetric," said Jared Haleck, chief product officer, Tekmetric.
Tekmetric Digital Ads is in early access now and rolling out to selected customers.
Tekmetric Phones
Every missed moment at the front desk has a cost. Tekmetric Phones gives your service advisors the customer context they need — instantly, the moment the phone rings — so they can spend less time looking things up and more time taking care of customers.
"Service advisors especially are loving it,” Haleck said. “It just saves them so much time. It creates so much convenience for them.”
Tekmetric Phones is in beta, available for customers on RingCentral.
Watch the On-Demand Webinar
Langston and Haleck walked through all of it — the industry data, live product demos, and what's coming next — in their webinar, "Building for the Results-Driven Repair Shop."
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