# How do you include taxes in a bid??



## Bobito651 (Jun 18, 2010)

I'm new to bidding on painting projects andI just put a bid in for a large apt. complex (exterior) and I was wondering if I should include the taxes in on my bid (which I did). the square footage on this job is around 670,000 and I charged $1.19 a square. How do I go about putting the taxes in my bid without scaring off my potential client. What or how do some of you guys do it, if you can attach a copy of an old estimate bid form that would help to or just let me know what you think! An accountant told me to hold 20% of what I bid for taxes, I just threw the 20% on top of my initial cost. Thanks in advance, this site is a great tool for people to learn about the business.


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## TJ Paint (Jun 18, 2009)

I have never had to itemize tax on a contract. 

Where do you live? What tax are you referring to?


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## Bobito651 (Jun 18, 2010)

just the tax that I have to pay the government, would I just incorporate that into what I charge per square foot? I really know nothing about bidding a large job lol. I charged $1.19 sq.ft. does that seem to high, the complexes are 3 stories and is hardy board, we are painting all the decking and exterior doors, somebody told me to come in at around .87 cents . I live in MPLS, MN


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## TJ Paint (Jun 18, 2009)

Bobito651 said:


> just the tax that I have to pay the government, would I just incorporate that into what I charge per square foot? I really know nothing about bidding a large job lol. I charged $1.19 sq.ft. does that seem to high, the complexes are 3 stories and is hardy board, we are painting all the decking and exterior doors, somebody told me to come in at around .87 cents . I live in MPLS, MN


I live in North Dakota, but grew up in MN. If I was bidding that, I would incorporate the eventual tax on income in the bid price. Technically, it would be a part of your overhead. Sounds like you don't have a complete picture of your overhead costs. 

Lets say you do this job and heaven forbid, at the end of the year you find that you lost money overall. Would you have income tax to pay?

Good luck!


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## TJ Paint (Jun 18, 2009)

Its actually more complex than what I mentioned. Theres a lot of factors involved, such as how your company is structured (sole proprietor, LLC, etc).


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## PressurePros (May 6, 2007)

Fed and employment taxes are built into your pricing and overall company structure...You don't collect them separately. The only time you would have to itemize taxes on service is if your state mandates that. In PA, we do not. If we do jobs in NJ, we are obligated to collect and pay that state's tax structure. Check your states website.


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## CliffK (Dec 21, 2010)

Here in New York state sales tax must be applied to all services. All our bids read $$$$$ + Sales Tax @8.625%. The only exception is new construction which is considered a capital improvement and is exempt. As far as Payroll taxes, including state and federal unemployment, that needs to be included into your estimate and is a matter of knowing your own cost of operation. Just like costs for insurance(workers comp & liability, etc.). It is very important to know your OWN numbers and not necessarily allow a "what it's currently going for rate" to dictate your bids. Income taxes- state & federal are a fact of all our lives, whether we are self employed or not and are not really part of the bid process. Those you are only paying on the profits-assuming there is any!


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## johnpaint (Sep 20, 2008)

We just say price plus tax and quickbooks does the rest.


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## BrushJockey (Mar 15, 2009)

I live in Mpls- and we don't have any service tax- what are you talking about..


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## johnpaint (Sep 20, 2008)

Yes the gov is in business too and wants their cut.


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## ComRemodel (Dec 11, 2007)

You're bidding on a nearly $800,000 job and you don't know how to figure your costs?


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## johnpaint (Sep 20, 2008)

ComRemodel said:


> You're bidding on a nearly $800,000 job and you don't know how to figure your costs?


Who said that?


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## RCP (Apr 18, 2007)

ComRemodel said:


> You're bidding on a nearly $800,000 job and you don't know how to figure your costs?



Welcome to Painttalk!


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## Bobito651 (Jun 18, 2010)

It just fell into my lap! I bid the job I just wanted to know what my peers thought. I'm new to the game and want to make sure that I'm doing things right. That's all dont get jealous lol


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## j0tun (Jan 10, 2009)

I in no way want to come off as rude here, but I really think you are way over your head bidding on a job of this size, when you are - in your own words - new to bidding on painting projects. The tax issue aside, I think you ought to be more concerned with having the correct amount and type of insurance and gaining more bidding experience on smaller projects, among many other things. I truly wish you the best, but you could really be setting yourself up for a hellish experience.


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## Bobito651 (Jun 18, 2010)

No I can handle the work! I've worked commercial for the union for over 7 years so the work is easy> I just never bid a project this big! I have a good group of 6-8 guys that can easily knock this out in a summer. I just wanted to know about the taxes because I really don't know about the bidding process on a project like this. 

Small residential is cut and dry; but now were talking hundreds of thousands on the board, it's whole new ballgame!

I put the bid in at a million and change and to be honest it'll be a challenge but I left enough room for the worst possible case scenario. 

If I get the bid my life will change drastically; you have to jump on opportunities like this! I know many contractors that would give up a little toe for something like this. No way would I let it pass me by!

Thanks for all the feedback though!


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## propainterJ (Jan 31, 2011)

So how many toes did you lose on this project??

I know this was ten years ago but it sure would be nice to hear how much money this guy made or lost on this million dollar project,or if he ended up hanging himself over the hassle of it.

I know guy says over a million how can OI lose??Well if it costs you 1.3 million to do it and your in hoc 20 ft over your head over it,thatd'be quite a bitter pill to swallow


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