What to Know: Section 179 for Auto Repair Businesses

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Read time: 3 min

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.

Section 179 for Auto Repair Businesses

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.

👉 Ready to grow your automotive business? [Book a personalized Tekmetric Demo Here]

FAQ

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If you’re an automotive shop owner or service advisor looking to upgrade your system, you’ve likely encountered the name Tekmetric. Like any smart shopper, you are looking for a free trial of Tekmetric before you purchase. Below, you can find a few options to test drive Tekmetric for free.

Option 1: Free Tekmetric Trial

To access your free Tekmetric self-guided trial, you can use this link here. It will walk you through the key parts of the Tekmetric software, customer experience, estimate building, customer approvals, digital vehicle inspections, and more. Afterwards, you can book a demo to chat with our sales team and start the onboarding process.

Option 2: Personalized Demo with Tekmetric

If you prefer to chat with a Tekmetric employee, you can book a demo here and ask any questions you have. We will show you how Tekmetric can maximize your efficiency, improve your customer experience, and boost sales. We will also talk about your shop's needs, goals for your business, and what gives your shop a competitive edge.

Option 3: Case Studies and Customer Reviews

We think our customers are the best sales team. So, we have provided our customer success stories, real customer reviews, and G2 rankings to aid in your decision-making process. This is a great place to see the ROI Tekmetric can provide for your shop.

Tek-Tip: Ask ChatGPT or Gemini for a summary of Tekmetric and how it could be a fit for your business.

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Final thoughts

Whichever option you pick, we hope you will give Tekmetric a try. Built by a former shop owner, Tekmetric understands the importance of finding the right software for your shop. Tekmetric offers month-to-month pricing options in addition to discounted annual plans to fit any budget. Unlimited users, unlimited RO's, unlimited support, no hidden fees. Are you ready to take your shop to the next level?

Tekmetric Free Trial: How to Test Drive Tekmetric Before Buying

December 2, 2025

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While it might not seem too obvious at first, there’s a unique opportunity for independent repair shops to enter the digital age. With the right tools for the job, auto repair shops can meet customer expectations at every step of the way, from texting inspection findings right to customers down to cardless payment options.

With the right features, independent auto repair shops can work faster, smarter, and more efficiently, while delivering the amazing customer service we’ve all come to expect.

In the auto repair industry, where customer trust and satisfaction are paramount, leveraging customer feedback is an invaluable strategy for improving shop performance. As technology improves, customer expectations for service quality and transparency continue to rise. Fortunately, shops can actively seek, analyze and act upon customer feedback to better position themselves to meet these expectations, enhance their service offerings and build long-term loyalty.

Customer feedback is a powerful tool that, when leveraged effectively, can lead to enhanced customer satisfaction, repeat business and a stronger reputation in the marketplace. As the industry continues to evolve to meet the needs of its customers, auto repair shops that prioritize and act on customer feedback will be better equipped to rise to these standards, thrive and succeed.

Know your audience in the modern industry

Today’s customers are increasingly more digital. In the past, auto repair shops relied on phone calls as their primary form of communication. In the modern market, however, digital communication like email or text messaging has become the preferred type of communication for most people. In fact, 91% of texts are opened within the first three minutes after receipt, with 81% of Americans texting regularly. Ultimately, the best way to get ahold of your customers is to cater to their preference – so ensure you know your audience’s preference and offer solutions that help meet their desired communication style.

Furthermore, the modern landscape of the customer experience emphasizes convenience. At the click of a button, you can have groceries delivered or receive an item within two days of ordering it. Long wait times and visiting brick-and-mortar stores to purchase items is no longer the only way customers can buy things. The same applies in auto repair shops. With this knowledge, you can implement digital solutions to make the customer experience more convenient, thereby increasing loyalty and ensuring your customers return time and time again.

Collect feedback on your shop’s customer experience  

Once you understand your audience in general, you should also strive to understand their experience with your business specifically. It’s important to foster a two-way relationship with the customer and give them the opportunity to share direct feedback. This can help you gain insight into the customer experience, including your shop’s strengths and pain points for customers, so you can adjust and improve.

Tracking feedback is just as important as tracking your shop’s internal operations or financial performance. You can gather feedback through multiple avenues: Google reviews, post-service surveys or even in-person conversations. Each option offers customers an opportunity to share their thoughts on areas where you perform well or bottlenecks that need to be addressed. 

Digital tools can help monitor all forms of customer feedback. Through Tekmetric, you can integrate with a variety of solutions to monitor and respond to feedback via Google reviews. Or, to help drive your customer experience and gather feedback, you can utilize Tekmetric’s Smart Jobs feature to create estimates within one click, allowing your service advisors to spend less time on manual labor and more time cultivating strong customer relationships. 

Leverage feedback to improve shop performance

Customer feedback is critical because it addresses your shop’s bottlenecks from the perspective of the vehicle owner. For example, some shops may include parts ordering and inventory tracking among service advisors’ responsibilities, in addition to taking care of the customer. At Tekmetric, we’ve found this creates many opportunities for miscommunication between the technician who needs the parts and the service advisor, leading to a delay that affects the customer. To solve this problem, we created our Inventory Orders feature so technicians can easily order the parts needed. This ensured better accuracy within the shop and a greater customer experience.

Customer feedback also highlights the importance of convenience when it comes to driving loyalty. For vehicle owners, convenience is not always about choosing the closest shop. It is about choosing the shop that will make their life easier. For example, digital payments solutions can create a more convenient solution for customers. With Tekmetric’s two-way texting and text-to-pay features, customers can pay from their desk or their home office, pay for their college kid who lives in a different state and even pick up their vehicles after regular business hours.

Implementing customer feedback cultivates a stronger connection between your shop and your customers. Through open dialogue, feedback creates a two-way relationship that allows you to address customer needs effectively and improve shop performance. Customer feedback can also help address bottlenecks and streamline processes in your shop, leading to enhanced customer experiences, increased loyalty and, ultimately, a healthier bottom line.

Leveraging Customer Feedback to Improve Shop Performance

September 27, 2024

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