Category: Auto Dealerships

  Recordkeeping is often essential to business operations and automobile dealerships are no exception. Many auto dealerships use the Last-In, First-Out (LIFO) method of inventory accounting. Although the LIFO method can provide significant tax benefits, you must be careful to meet certain tax law requirements. One such requirement that is often overlooked is the need to maintain comprehensive records. There are different LIFO methods for new and used vehicle inventories. For new vehicle inventories, dealerships electing to use the alternative… Read more ›

  When President Biden signed the Inflation Reduction Act bill into law in August 2022, the Electrical Vehicle (EV) tax credit underwent immediate and long-term changes. Knowing what is coming and how to work with your clients under contract and future customers will be paramount to providing exemplary service and accurate information. The new clean vehicle credit rules Dealership challenges to be aware of The National Highway Traffic Safety Administration (NHTSA) has a VIN decoder to help dealerships and customers… Read more ›

Vehicle rebates are a selling tool car dealerships and manufacturers use to drive more business, even when most consumers are paying above sticker price on vehicles. Since rebates are not discounts or coupons, dealerships receive the funds from the rebate after the vehicle has been purchased from the manufacturer and sold to a consumer. This means accounting teams at the dealership must make adjustments once the rebate is received. When rebates are not paid for promptly, it can create over-aged… Read more ›

Searching for revenue to keep the bottom line healthy, a number of dealerships have added F&I products to their service offerings. A possible influx of longer-term customers at your store can make it worthwhile to consider selling service contracts and related products in the service lane. Timing Is Everything Dealerships are finding that it’s easier to sell F&I products at the time of a costly repair, or when the customers’ warranties are about to expire, than it was at the… Read more ›

As business owners, reliance on employees and vendors to help your dealership run smoothly is par for the course. Sometimes, those vendors and individuals take advantage of situations to increase their profits. Vendor fraud involves payments made to actual or fictitious vendors for personal gain. It is a lucrative industry that can take tens to hundreds of thousands of dollars off your bottom line. Types of Vendor Fraud There is a good chance your dealership has experienced some form of… Read more ›

Acquiring a company will leave you with a long to-do list, which means you can’t devote all of your time to the deal’s potential tax implications. However, if you neglect tax issues during the negotiation process, the negative consequences can be serious. To improve the odds of a successful acquisition, it’s important to devote resources to tax planning before your deal closes. Complacency Can Be Costly During deal negotiations, you and the seller should discuss such issues as whether and how much… Read more ›

The auto dealership group at Councilor, Buchanan & Mitchell (CBM) participated in a survey several years ago to determine how prepared dealership are for a succession planning process. The survey, which incorporated feedback from respondents nationwide, found that auto dealers are pushing succession planning back by more than 5 years. Furthermore, nearly 50 percent of the dealerships surveyed admitted that while succession is important, they haven’t dealt with it yet. The results of the succession planning survey, which continue to… Read more ›

  Before they can legally drive a vehicle, individuals must obtain a minimum level of automobile liability insurance. Similarly, dealerships are also legally required to carry certain types of insurance to operate in most states. If you haven’t reviewed your store’s insurance policies recently, now might be a good time to do so. Your goal is twofold: to make sure you have the right coverages for the risks involved in operating your dealership and to keep your insurance premiums as… Read more ›

PDF: Councilor, Buchanan & Mitchell Partner Dan Keefer Graduates from Upstream Academy’s Emerging Leaders Program Dan Keefer, CPA, CVA, a partner at Councilor, Buchanan & Mitchell, has graduated from the Upstream Academy’s Emerging Leaders Program. The program, which develops future leaders in the accounting profession through a rigorous, year-long period of instructor-led trainings, dialogue and the hands-on application of new knowledge, engages participants on the most pressing issues facing the industry. “The Emerging Leaders program broadened my understanding of what… Read more ›

One estate-planning tool that can protect your family and the partners in your dealership is a buy-sell agreement. This legal document may give owners the first shot at buying an interest in the company if another owner pulls out, becomes disabled or dies. Ideally, these contracts are drawn up when a business is launched, or acquired from other owners, but they can be entered into later. Don’t wait too long. If you die or become disabled without an agreement, it… Read more ›