Accounting & Tax Services for Auto Dealerships
Floor plan financing, inventory accounting, and F&I income tracking for dealers.
What Makes the Books Different in Auto Dealerships
Floor plan financing - the line of credit dealers use to stock inventory - carries interest that needs to be tracked per unit, not just as a lump monthly expense, or your true cost on each vehicle sold is wrong.
Inventory accounting is more involved than most retail: specific identification (tracking cost by VIN) is standard, and depending on your volume and structure, LIFO considerations can materially affect your reported income and tax liability.
Reconditioning costs - parts, labor, detailing - need to be tracked per vehicle and rolled into your cost basis, not expensed generally, or your per-unit gross profit numbers won't reflect reality.
F&I income - financing, warranties, add-on products - is a separate revenue stream with its own recognition timing and sometimes its own compliance requirements, and it needs to be accounted for separately from vehicle sale gross.
Dealer licensing, bonding, sales tax collection, and title and registration handling all touch the accounting side directly - sales tax and title fees flow through your books whether or not you think of them as your money.
How We Help
Compliance & Licensing
We help you stay current on dealer licensing and bonding requirements, and make sure sales tax and title/registration handling on every deal is accounted for correctly.
Bookkeeping & Clean-Up
Inventory tracked by VIN with reconditioning costs rolled into cost basis, floor plan interest tracked per unit, and F&I income kept separate from vehicle sale gross.
Tax Planning
We review your inventory valuation method, plan around floor plan interest deductibility, and look at entity structure against your actual sales volume and profit.
Tax Return Preparation & Filing
Returns prepared with inventory, floor plan financing, and F&I income reconciled first, matching the per-unit numbers your sales team already tracks.
Payroll
Payroll built for a mix of salaried staff and commissioned sales and F&I roles, with commission structures set up correctly from the start.
CFO Advisory & Consulting
Per-unit gross profit reviews across new, used, and F&I, floor plan cost analysis, and cash flow planning around inventory turn.
Choosing the Right Entity
Dealership structure often depends on bonding and state licensing requirements as much as tax considerations - some states have specific entity rules for licensed dealers. We'll confirm what your state requires before recommending LLC, S-corp, or C-corp structure.
Explore Business Formation OptionsFrequently Asked Questions
How should I be tracking floor plan interest?
Per unit, not as one lump monthly expense, so your true cost on each vehicle - and your actual per-unit gross profit - reflects what that specific unit cost you to hold.
What's the difference between specific identification and LIFO for my inventory, and does it matter?
Specific identification tracks cost by VIN, which most dealers use day to day. Whether LIFO makes sense on top of that depends on your volume and how vehicle costs are trending - it can have a real effect on taxable income, so it's worth reviewing rather than assuming.
Should F&I income be tracked separately from vehicle sales?
Yes. It's a different revenue stream with different recognition timing, and mixing it into vehicle sale gross makes your per-unit numbers inaccurate.
Do reconditioning costs get expensed or added to the vehicle's cost basis?
Added to cost basis, tracked per unit, so your gross profit on that specific vehicle reflects what it actually cost to get sale-ready.
Ready to Talk About Your Books?
Tell us where things stand and we'll tell you honestly what needs attention first.