As a deck builder, you're an expert at creating beautiful outdoor spaces that enhance your clients' homes and lives. But when it comes to managing your business finances, you might feel like you're on shaky ground. At Vickney & Associates CPA, we've helped numerous deck builders strengthen their financial foundation. Here are our essential bookkeeping tips to help your deck building business thrive.

Track Job Costs Meticulously

The foundation of profitable deck building is understanding exactly what each project costs. For every deck, you should track:

• Materials: Document all lumber, hardware, concrete, and finishing materials by project
• Labor: Record hours spent by each worker on specific jobs
• Equipment: Track rental costs or equipment usage by project
• Permits and Inspections: Keep records of all regulatory costs

Consider using project management software that integrates with your accounting system to easily assign costs to specific jobs. This allows you to see which projects are most profitable and identify where costs may be getting out of hand.

Separate Personal and Business Finances

Many deck builders start as solo operations and fail to establish proper business banking. This commingling creates a bookkeeping nightmare and potential tax issues.

Establish:

• A dedicated business checking account
• A business credit card for materials and supplies
• A system for tracking any personal vehicle use for business purposes

This separation makes tax time easier and gives you a clear picture of business performance.

Implement a System for Managing Deposits and Progress Payments

Deck projects typically involve significant materials costs upfront and extend over multiple weeks. Your bookkeeping system must properly handle:

• Customer deposits (which aren't income until earned)
• Progress payments
• Final payments
• Retainage (if applicable for larger projects)

We recommend recording deposits as a liability until the work is performed, then recognizing revenue as you complete project milestones.

Stay on Top of Accounts Receivable

In the deck building business, managing cash flow is critical, especially when juggling multiple projects. Implement these practices:

• Send invoices promptly when milestones are reached
• Follow up on overdue payments quickly
• Consider offering early payment discounts
• Require deposits before ordering materials
• Use electronic payment options to speed up collections

A regular review of accounts receivable aging will help you identify collection issues before they become serious problems.

Track Seasonal Patterns

The deck building business is inherently seasonal in Wisconsin, with busy summer months and slower winter periods. Your bookkeeping should help you:

• Track month-to-month revenue patterns
• Build reserves during busy months
• Plan for reduced winter income
• Budget for year-round fixed expenses
• Identify opportunities for off-season revenue streams

This seasonal awareness helps ensure your business remains financially stable throughout the year.

Properly Categorize Vehicle and Equipment Expenses

As a deck builder, you likely have significant investments in trucks, trailers, and specialized tools. Proper tracking of these expenses is essential:

• Maintain detailed mileage logs for vehicles
• Track maintenance and repair costs by vehicle or equipment piece
• Consider depreciation strategies for larger equipment purchases
• Document usage patterns to justify business expense deductions

With the right documentation, these substantial expenses can provide valuable tax deductions.

Consider Cloud-Based Accounting Solutions

Modern cloud accounting platforms like QuickBooks Online or Xero offer significant advantages for deck builders:

• Access your books from job sites via mobile apps
• Capture receipt images immediately with your phone
• Create and send invoices while still at the customer's home
• Connect with project management and estimating software
• Share real-time financial information with your accountant

These tools can dramatically reduce your bookkeeping time while improving accuracy.

Plan for Quarterly Tax Payments

With proper profit margins, deck building can generate significant income, which means quarterly estimated tax payments. Your bookkeeping system should:

• Calculate your tax liability throughout the year
• Set aside funds for quarterly payments
• Document business deductions thoroughly
• Track owner's draws vs. legitimate business expenses

Working with an accountant experienced in construction businesses can help you minimize tax liability while staying compliant.

Need Help Building a Stronger Financial Foundation?

At Vickney & Associates CPA, we understand the unique bookkeeping challenges deck builders face. Our team can help you implement these best practices and develop a customized financial management system that supports your business goals.

Contact us today to schedule a consultation and learn how our proactive accounting approach can help your deck building business thrive year-round.