Painting Contractors, CPA & Tax Services

Why Painting Contractors in Dallas Need a CPA Who Knows the Trade

Painting contractors deal with tax issues that most general accountants miss entirely. Between classifying your crews correctly, depreciating sprayers and vehicles, tracking costs across dozens of active jobs, and handling warranty callbacks, your books require someone who understands how a painting business actually operates. A single misclassification of a crew member can trigger an IRS audit and back-owed payroll taxes that dwarf your profit on an entire season of work.

At AG Freideman, we work with painting contractors across Dallas, Plano, Frisco, McKinney, and the surrounding DFW area. Al Freideman is a licensed CPA with over 30 years of experience, and he handles every painting contractor client personally. No hand-offs to junior staff, no generic advice. We understand the difference between a residential repaint crew and a commercial new-construction team, and we structure your accounting accordingly.

If you are bidding jobs without accurate cost data, guessing at depreciation, or unsure whether your painters should be W-2 employees or 1099 subcontractors, call us at (972) 893-3481 to book a free consultation.

How Does Job Costing Help Painting Contractors Win More Profitable Bids?

Job costing is the process of tracking every dollar of labor, materials, equipment, and overhead tied to a specific project. For painting contractors, it is the difference between bidding profitably and slowly bleeding money on jobs that look good on paper but lose once you factor in prep time, travel, and paint waste.

We set up your books so each job has its own cost center. That means you can see, in real time, how much a 4,000-square-foot exterior repaint in Plano actually costs versus the $8,500 you quoted. When your next similar bid comes up, you are working from real numbers instead of gut feeling.

• Direct labor: Hours per crew member on each job, including drive time and prep
• Materials: Paint, primer, caulk, tape, drop cloths, and any specialty coatings tracked per project
• Equipment allocation: Sprayer use, lift rentals, scaffold costs assigned to the jobs that used them
• Overhead distribution: Insurance, vehicle costs, and shop rent allocated proportionally across active jobs

Most painting contractors we meet are using one bank account and a spreadsheet. We move you into a proper QuickBooks structure with job costing built in, so every estimate you write next quarter is backed by actual data from your completed projects.

Are Your Painters Employees or Independent Contractors?

Crew classification is the single highest-risk tax issue for painting contractors in Texas. The IRS uses a multi-factor test to determine whether a worker is a W-2 employee or a 1099 independent contractor, and simply paying someone “per job” does not automatically make them a subcontractor. If your painters use your sprayers, follow your schedule, and work exclusively for your company, the IRS is likely to classify them as employees regardless of what your contract says.

The consequences of misclassification are severe. You become liable for unpaid payroll taxes (the employer’s share of Social Security and Medicare at 7.65%), plus penalties and interest. The IRS can assess these taxes going back three years or more. The Texas Workforce Commission can also impose state unemployment tax liability retroactively.

We review your crew arrangements and help you structure compliant relationships. For painters who genuinely operate as independent subcontractors (they carry their own insurance, serve multiple clients, provide their own equipment), we ensure your 1099 reporting is accurate. For crew members who should be W-2 employees, we set up payroll processing so you stay compliant from day one. Our monthly bookkeeping and payroll services start at $300 to $600 per month, which includes bank reconciliation and payroll processing for your crew.

What Equipment Can Painting Contractors Depreciate in 2026?

Painting contractors invest heavily in vehicles, airless sprayers, pressure washers, lifts, and other equipment that qualifies for tax depreciation. Under IRS Section 179, you can deduct the full purchase price of qualifying equipment in the year you buy it, up to $1,250,000 for the 2026 tax year. Bonus depreciation remains available at 40% for 2026 under the phase-down schedule established by the Tax Cuts and Jobs Act.

Common depreciable assets for painting contractors include:

• Work vehicles and cargo vans: Vehicles over 6,000 pounds GVWR (such as a Ford Transit 250 or Chevy Express) qualify for higher Section 179 deductions. Lighter vehicles are subject to annual luxury auto limits.
• Airless sprayers: A Graco or Titan commercial sprayer costing $3,000 to $8,000 can be fully expensed under Section 179 in the year of purchase.
• Pressure washers, scaffolding, and lifts: All qualify as business equipment with a 5 to 7 year recovery period if you elect standard depreciation instead of Section 179.
• Trailers: Enclosed trailers used to transport equipment and materials are depreciable business assets.

We track every asset you purchase, calculate the most advantageous depreciation method for your situation, and ensure nothing is missed at filing time. For painting contractors operating as S-Corps or sole proprietors, the right depreciation strategy can reduce your tax liability by thousands of dollars each year.

How Should Painting Contractors Handle Warranty and Callback Costs?

Warranty reserves are a frequently overlooked issue for painting contractors. When you guarantee your exterior work for two or three years, you are committing to future costs (labor, materials, travel) that reduce your true profit on the original job. The IRS has specific rules about when and how you can deduct these costs, and getting it wrong means either overstating income now or triggering deductions you cannot support later.

For cash-basis taxpayers, which includes most small painting companies, you generally cannot deduct warranty costs until you actually incur the expense. That means the callback you handle in March 2026 for a job completed in 2024 is a 2026 deduction. We track these costs separately in your books so they are captured correctly and tied back to the original job for your internal profitability analysis.

For larger painting contractors who have transitioned to accrual-basis accounting, there are provisions to accrue estimated warranty costs in the year the work is performed. We help you determine which method is right for your revenue level and business structure.

Common Tax Mistakes We Fix for Painting Contractors

After 30 years of working with small business owners across Dallas-Fort Worth, we see the same costly mistakes from painting contractors who come to us after outgrowing their previous accountant or DIY approach:

• Treating all crew members as 1099 subcontractors without meeting the IRS independence test. This is the most common and most expensive mistake. We have helped painting contractors resolve back payroll tax assessments and restructure their workforce to prevent future liability.
• Failing to track job costs separately. Without per-job tracking, you cannot identify which types of work (residential interior, commercial exterior, new construction) are actually profitable. You end up chasing revenue instead of margin.
• Missing vehicle and equipment depreciation deductions. Many contractors simply deduct gas and repairs but never claim Section 179 or standard depreciation on their vans, sprayers, and trailers. This leaves thousands of dollars on the table every year.
• Ignoring the Texas Franchise Tax. Texas has no state income tax, but every LLC and corporation must file a franchise tax report with the Texas Comptroller by May 15 each year. The no-tax-due threshold for 2026 is $2,470,000 in total revenue, but you still must file the report. We handle your franchise tax filing for $250 to $500.
• Not collecting or remitting sales tax on taxable services. In Texas, most painting services applied to real property (houses, commercial buildings) are not subject to sales tax. However, if you sell paint or materials separately, or perform work classified differently, sales tax obligations can apply. We review your service mix and ensure compliance.

Work With a CPA Who Understands Painting Contractors

Al Freideman has spent over 30 years helping Dallas-Fort Worth business owners keep more of what they earn. With 52 five-star Google reviews and transparent pricing, we give painting contractors the personal attention and trade-specific expertise that generic accounting services simply cannot match. Whether you need tax preparation, payroll for your crews, bookkeeping with real job costing, or help resolving an IRS notice, Al handles it personally.

Book your free consultation today. Call (972) 893-3481 or visit agfreideman.com/meeting to schedule a time that works for you.