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Old 05-27-2019, 04:05 PM   #1
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Default Invoice items

I am just starting my business and I have been doing jobs for time and materials while I get an idea of how to make an accurate bid.
My question is for the invoices. Should I itemize and list each of the materials items?
I know I will have a couple categories of paint.
10 gallons eggshell --
5 gallons semigloss
etc
but I am also going to throw in a roller, the tape, a few other things.
do I list each thing separately? Do people include copies of receipts on an invoice?

And also , for instance, like my caulk. I think I used 4 or 5 tubes out of a case of 10.
just itemize half a case of caulk?

What else is included on an invoice? I am working out how to go legit , and I will have to figure out sales tax and all for this state. I guess with a good bid I would calculate in taxes. but for now one property manager keeps giving me 1099's and I keep thinking , "wait a minute, my time and materials didn't take into account my taxes." I already charged him too little for time$ and that makes it difficult to raise it. Thats just a mistake that i took as a lesson learned.
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Old 05-27-2019, 04:26 PM   #2
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Quote:
Originally Posted by DittonWilson View Post
I am just starting my business and I have been doing jobs for time and materials while I get an idea of how to make an accurate bid.
My question is for the invoices. Should I itemize and list each of the materials items?
I know I will have a couple categories of paint.
10 gallons eggshell --
5 gallons semigloss
etc
but I am also going to throw in a roller, the tape, a few other things.
do I list each thing separately? Do people include copies of receipts on an invoice?

And also , for instance, like my caulk. I think I used 4 or 5 tubes out of a case of 10.
just itemize half a case of caulk?

What else is included on an invoice? I am working out how to go legit , and I will have to figure out sales tax and all for this state. I guess with a good bid I would calculate in taxes. but for now one property manager keeps giving me 1099's and I keep thinking , "wait a minute, my time and materials didn't take into account my taxes." I already charged him too little for time$ and that makes it difficult to raise it. Thats just a mistake that i took as a lesson learned.
This is my own opinion, others will disagree but on bid work it's none of the customers business what you charge per hour, how much material you used, or if you want to mark it up for the hassle of going to the paint store so often. Bid the job with a total price no breakdown!

Now, on a T&M job breakdown your hours multiply by whatever your labor rate is and bill them for all paint, caulk, sandpaper or any other sundries you use.

Remember that painting is a business, not a charity.
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Old 05-27-2019, 05:57 PM   #3
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When doing T&M statements (invoices) I will typically list out the paints and primers but for all of the rest, I just put down, “sundries”, and lump them together. Though in parentheses I may put something like, “ tape, plastic, roller covers, etc.”, so they know what I mean by sundries.
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Old 05-27-2019, 06:54 PM   #4
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Quote:
Originally Posted by DittonWilson View Post
I am just starting my business and I have been doing jobs for time and materials while I get an idea of how to make an accurate bid.

My question is for the invoices. Should I itemize and list each of the materials items?

I know I will have a couple categories of paint.

10 gallons eggshell --

5 gallons semigloss

etc

but I am also going to throw in a roller, the tape, a few other things.

do I list each thing separately? Do people include copies of receipts on an invoice?



And also , for instance, like my caulk. I think I used 4 or 5 tubes out of a case of 10.

just itemize half a case of caulk?



What else is included on an invoice? I am working out how to go legit , and I will have to figure out sales tax and all for this state. I guess with a good bid I would calculate in taxes. but for now one property manager keeps giving me 1099's and I keep thinking , "wait a minute, my time and materials didn't take into account my taxes." I already charged him too little for time$ and that makes it difficult to raise it. Thats just a mistake that i took as a lesson learned.
You are the second person on here recently that has mentioned having to pay sales tax. We do have to do that in MA. Is it just for labor, or is it also for materials? Seems like if it is for materials, an item would be taxed twice. Once when you buy it and then when you charge the customers. Technically,we have to charge sales tax on martetials but only if we upcharge, which is one of the reasons I do not upcharge. On bigger jobs I will add labor costs for the time it takes me to get the materials.

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Old 05-27-2019, 07:47 PM   #5
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Originally Posted by Pete Martin the Painter View Post
You are the second person on here recently that has mentioned having to pay sales tax. We do have to do that in MA. Is it just for labor, or is it also for materials? Seems like if it is for materials, an item would be taxed twice. Once when you buy it and then when you charge the customers. Technically,we have to charge sales tax on martetials but only if we upcharge, which is one of the reasons I do not upcharge. On bigger jobs I will add labor costs for the time it takes me to get the materials.

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I think you would have to be correct on this Pete. If you purchase five gallons of paint for $200 dollars including tax, and then turn around and bill your customer for the $200, you are just breaking even, having already paid the tax upon your purchase. No profit made, hence no tax.

Now if you upcharge $10 per gallon and bill your customer $250 for the paint, you would need to pay a sales tax on the extra $50 you made, at least that seems to be the common sense way it should work.

Much better to add in a percentage on your labor for the time and effort you spent ordering, picking up, and getting the product to the site. That is what I do even though we have no sales tax to contend with.

And just to be clear, this is just my view on how it I think it should work. A CPA would be the one to confirm this stuff with.
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Old 05-27-2019, 10:04 PM   #6
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Originally Posted by Brushman4 View Post
This is my own opinion, others will disagree but on bid work it's none of the customers business what you charge per hour, how much material you used, or if you want to mark it up for the hassle of going to the paint store so often. Bid the job with a total price no breakdown!

Now, on a T&M job breakdown your hours multiply by whatever your labor rate is and bill them for all paint, caulk, sandpaper or any other sundries you use.

Remember that painting is a business, not a charity.
I agree with brushman. On a bid job there is no need to break down your invoice. A simple "Painting of X as per quote" will do. They all ready know the price and they don't need to know the profit your making. On a t&m job you will need to break down the price as much as possible. The more detailed it is the less problem you'll have with people questioning the invoice.
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Old 05-27-2019, 11:55 PM   #7
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The following paragraph is the result of a two minute google search titled "sales tax obligation for time and material in Idaho"

From web site:

A cabinetmaker agrees to build cabinets and install them in a home. The bid for the job includes the cost for labor and materials. The materials cost $1,000. A contractor doesn't charge sales tax to the customer, so the bid should be high enough to cover any tax paid on materials without itemizing the sales tax on the bid. If the tax rate is 6%, the cabinetmaker must pay $60 sales tax to the material supplier (or, if the supplier doesn't collect Idaho sales tax, the cabinetmaker must pay $60 use tax to the state). The customer's bill should include a materials cost of $1,060. The bill might read:
Job materials
$1,060

Labor
$3,000

Total
$4,060

(If sales tax is charged on the bill, the customer can refuse to pay it. If it's charged in error and paid, the contractor must report and pay the sales tax collected to the state and still must pay tax on the materials.)
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Old 05-28-2019, 12:48 AM   #8
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Originally Posted by RH View Post
When doing T&M statements (invoices) I will typically list out the paints and primers but for all of the rest, I just put down, “sundries”, and lump them together. Though in parentheses I may put something like, “ tape, plastic, roller covers, etc.”, so they know what I mean by sundries.
RH, I agree but you're giving people a lot of credit for knowing what sundries are, especially in this day and age!
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Old 05-28-2019, 05:14 PM   #9
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Quote:
Originally Posted by CApainter View Post
The following paragraph is the result of a two minute google search titled "sales tax obligation for time and material in Idaho"

From web site:

A cabinetmaker agrees to build cabinets and install them in a home. The bid for the job includes the cost for labor and materials. The materials cost $1,000. A contractor doesn't charge sales tax to the customer, so the bid should be high enough to cover any tax paid on materials without itemizing the sales tax on the bid. If the tax rate is 6%, the cabinetmaker must pay $60 sales tax to the material supplier (or, if the supplier doesn't collect Idaho sales tax, the cabinetmaker must pay $60 use tax to the state). The customer's bill should include a materials cost of $1,060. The bill might read:
Job materials
$1,060

Labor
$3,000

Total
$4,060

(If sales tax is charged on the bill, the customer can refuse to pay it. If it's charged in error and paid, the contractor must report and pay the sales tax collected to the state and still must pay tax on the materials.)
You have to pay sales tax on the material unless you provide your supplier with your sales tax ID and get an exemption. Totally worth marking up and itemizing your paint on the invoice.

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Old 05-28-2019, 05:25 PM   #10
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You have to pay sales tax on the material unless you provide your supplier with your sales tax ID and get an exemption. Totally worth marking up and itemizing your paint on the invoice.

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And it isn't considered double tax dipping. T & M billing problem solved. NEXT!
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Old 05-28-2019, 09:11 PM   #11
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Do not itemize cost. Dont help them figure out your profit margin. Also forget time/material. There's a thing called perceived value. All businesses are using it to maximize profits.
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Old 05-29-2019, 12:07 AM   #12
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Do not itemize cost. Dont help them figure out your profit margin. Also forget time/material. There's a thing called perceived value. All businesses are using it to maximize profits.
If painters relied on a homeowner's perceived value of a paint job, we'd be working for minimum wage.

Perceived value has more to do with what's trendy, nostalgic, unique and has the potential to increase in value rather than what amounts to a maintenance service. But it's a free market. You can charge whatever is tolerated.
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Old 05-29-2019, 01:05 AM   #13
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This is what I send a potential client after I figure the bid. Then, when they say yes, I have them sign then add a contract, collect 10% to put them on my schedule. Finish work, collect remainder 90% due. My pay, employee pay, material costs, overhead costs, material overhead, profit are mine and mine alone to know. And, don't ever fall for the "this other guy bid this, so can you match it." That's insulting, plus the longer you do this, the better and more efficient you will become, plus get to charge more for it.


Also, just do t&m for small handman stuff, like less than $500 for the whole job.
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Old 05-29-2019, 08:04 PM   #14
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In PA (as many other states) any upcharge on materials is not subject to sales tax. The contractor pays the sales tax when the materials are purchased, and that's it. Kind of defies logic, but I'm not complaining.

You would benefit from sitting down with an accountant. The internet isn't the best place to get tax advice.
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Old 05-29-2019, 08:56 PM   #15
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Originally Posted by RH View Post
When doing T&M statements (invoices) I will typically list out the paints and primers but for all of the rest, I just put down, “sundries”, and lump them together. Though in parentheses I may put something like, “ tape, plastic, roller covers, etc.”, so they know what I mean by sundries.


That’s exactly how I was thinking of doing it


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Old 05-30-2019, 08:34 PM   #16
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If painters relied on a homeowner's perceived value of a paint job, we'd be working for minimum wage.

Perceived value has more to do with what's trendy, nostalgic, unique and has the potential to increase in value rather than what amounts to a maintenance service. But it's a free market. You can charge whatever is tolerated.
What kinds of clients do you work for? Many homeowners considering painting the exterior of a house to be a very expensive thing to do. Some get lines of equity to pay for it.
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Old 05-30-2019, 08:56 PM   #17
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What kinds of clients do you work for? Many homeowners considering painting the exterior of a house to be a very expensive thing to do. Some get lines of equity to pay for it.
I stopped painting residentials around 1995. And you're right, painting a house can be pretty expensive today. But given the wide range of acceptability in terms of what the painting product is and how its service is provided, I'm not convinced the idea of perceived value can lift this industry, as a whole, from the depths of the trades strata any more than clean whites, Polo shirts, and Khakis have. But it sounds sophisticated and fits right in with the rest of the sexy management tools available to any Average Joe with internet access.

I do believe it's limited to a niche market.
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Old 05-31-2019, 02:19 AM   #18
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What kinds of clients do you work for? Many homeowners considering painting the exterior of a house to be a very expensive thing to do. Some get lines of equity to pay for it.
You said in a previous thread that all the HO's you were working for were all financially stable, didn't have extensive debts and so on. Now you're saying they have to access lines of credit to pay you for an exterior?
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Old 05-31-2019, 08:44 AM   #19
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You said in a previous thread that all the HO's you were working for were all financially stable, didn't have extensive debts and so on. Now you're saying they have to access lines of credit to pay you for an exterior?
Pretty sure I would not use the word ALL to describe anything. I may have said "some" or "many".

I have "some" clients whom I know are overspending and not shopping wisely.

And some who do not work and drive 100k cars.

In the other thread, I was simply disagreeing that all success full people are cheating, everyone's in debt, everyone hungry and cheating to get by.

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Old 06-04-2019, 09:40 PM   #20
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DittonWilson where in Idaho are you at?


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