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783 Rio Del Mar Blvd, Suite 7, Aptos, CA, 95003
Construction Insurance Bulletin
Safety Precautions For Your Construction Site Space Heaters
Keeping your work site or job trailer warm during cold winter weather can be challenging. You may turn on a few space heaters since they’re affordable and portable heat sources. Space heaters can be hazardous, though, so use these precautions to improve safety.
Purchase Newer Models
Replace older space heaters with new models that comply with safety regulations. Also, look for an Underwriters Laboratory (UL) label, proof that the heater has undergone independent safety testing.
Choose a Thermostatically Controlled Heater
Instead of using space heaters you turn on and off manually, select models with a thermostat control. They stay on until the room reaches the desired temperature, then shut off. These heaters warm your space and reduce energy waste.
Look for the Automatic Shut Down Feature
Safe space heaters will shut down automatically when they tip over. This feature reduces fire risk.
Buy the Right Size
Oversized heaters waste energy. Measure your space and use heaters that are the right size for the room.
Place Heaters on a Flat, Open Surface
Your space heaters could tip over and cause a fire if you place them on a rounded, tilted or uneven surface or under a desk. Always place space heaters on a flat surface in the open.
Remove Combustible Materials
Place your space heaters at least three feet away from materials that might catch fire. Combustible materials include paper boxes, trash cans, desks, file cabinets, wood, and fuel.
Locate the Heaters away from Traffic
Space heaters can become tripping hazards if you place them in the middle of the walkway. Instead, locate your space heaters out of the way where they can warm the room without causing an accident.
Power Electric Space Heaters Properly
Only plug electric space heaters directly into the wall rather than into an extension cord. Make sure the cord is not frayed or damaged, either. These precautions reduce electrical shock and overheating.
Use the Right Fuel
Liquid-fueled space heaters require a certain type of fuel. Only use the approved fuel, which you should store in a clearly labeled container outdoors and away from all heat sources and combustible materials.
Inspect Space Heaters Annually
Before using your space heaters, inspect them carefully. Ensure the heaters start properly and have intact cords, guards, feet, and control knobs.
Attend Space Heaters at all Times
Never leave space heaters unattended. Turn them off when you leave the office or job site, and unplug the units before you leave work for the last time each day.
Space heaters keep your construction work site or office warm in the winter. Use these precautions as you use your space heaters safely. For additional winter safety tips, talk to your insurance agent.
Scurich Insurance Services
What Insurance Is Right for Occasionally Used Employee Vehicles?
Jillian owns a small office supply store, and she sometimes asks her employees to make customer deliveries in their personal vehicles. She wonders if she needs to purchase a commercial auto insurance policy to cover any accidents or other related claims. Two questions help Jillian address this risk and determine what type of insurance is best for her needs, and they can help you, too, if you’re in a similar situation.
What type of work tasks is the vehicle used to perform?
A commercial auto insurance policy is the best choice if personal vehicles are used by employees to:
Visit client locations
Transport clients or employees
Travel to or between work or remote locations
Transport tools or equipment that are essential for employment
Transport goods or people for a fee
If your employees perform any of these tasks and need to file an insurance claim, their personal auto insurance policy may deny the claim. Their personal policy could also be cancelled, leaving them without this valuable coverage.
Does the employee have personal auto insurance?
A personal auto insurance policy is designed primarily for personal use. However, a personal policy may also include a special business-use designation. It may also cover occasional business use if the insured vehicle is a private passenger car or van.
Inspect your employees’ personal auto insurance policies to ensure it will cover an accident that occurs if the vehicle is used for business purposes. Otherwise, you or your employee will hold financial responsibility, which is quite costly and a huge risk.
After you answer these two questions, you will know if you need commercial auto insurance or if your employees’ personal auto policies will suffice. If you discover that you need a commercial auto insurance policy, be sure it covers your needs and includes:
An affordable deductible - you don’t want to compromise your company because your deductible is too high.
Adequate coverage for any type of accident, including minor fender benders and serious crashes that cause bodily injury and property damage.
Access to a rental vehicle - if you use a vehicle regularly for work-related tasks, your policy should include a rental vehicle you can use while your vehicle is being repaired.
Coverage for legal expenses - protect your company when you purchase auto insurance that covers legal expenses related to an auto insurance claim.
Like Jillian, you may ask employees to drive their personal vehicles occasionally. Most likely, you will benefit from a commercial auto insurance policy. Your insurance company can customize a commercial auto insurance policy that fits your driving habits and needs. Discover more details today as you get the coverage that’s right for you.
Scurich Insurance Services
Construction Business Tax Deductions
Filing taxes for your construction business is one of the requirements of business ownership. Lower your tax bill when you know which business deductions you can take.
Internal Revenue Service (IRS) rules state that you can deduct all “ordinary and necessary” business expenses. An ordinary expense is common in the construction industry while a necessary expense helps your construction business succeed. Examples of ordinary and necessary expenses include:
Bad business debts.
Equipment rental fees.
Legal and professional fees.
Tool repair and maintenance.
Trade association dues.
Remember not to deduct the expenses clients reimburse you for. For example, if you purchase materials for a client’s deck repair project and charge the client for those materials, you cannot also deduct those materials on your taxes.
As a construction professional, you probably spend the majority of your workday on the job site. However, you can deduct your home office if you use the space exclusively and regularly for business purposes.
You can deduct the money you pay employees and subcontractors. Be sure to classify employees and subcontractors properly, though, or you could face heavy fines.
You use your tools, vehicle and other equipment for business purposes, but you may also use these items for personal use. So if you use your cellphone equally for both business and personal calls, you can deduct half your phone bill on your business tax return.
Personal Credit Card
The interest you pay on your personal credit card, home equity loan or other personal credit source can be deducted. However, only deduct the interest owed for the purchases you make exclusively for your construction business.
Choose the actual cost or standard mileage deduction for your construction vehicle. For the actual cost, track the total expenses you pay for the vehicle’s operation, including fuel, repairs and insurance, and the percentage of time you use the vehicle for business purposes. For the standard mileage deduction, track the total number of miles you drive the vehicle for work purposes and take a standard deduction per mile.
Keep Accurate Records
To make tax filing easier, track your income and expenses throughout the year. You'll stay more organized when you schedule time each month to sort receipts. Also, double check that you’ve correctly recorded and calculated all your income and expenses so your tax return is accurate.
Your construction business qualifies for numerous tax deductions. Talk to your insurance agent or accountant for more information as you take time at the end of the year to prepare to file your 2018 tax return and lower your bill.
Scurich Insurance Services
Should You Lease or Buy Equipment?
In your small business, you may use a variety of equipment, including tools, vehicles, excavators, computers, and landscaping tools. You can lease or buy this equipment. Because both options include risks, compare both options.
Benefits of Leasing
Save money right now. Equipment can cost hundreds of thousands of dollars upfront to purchase. A lease requires a smaller initial payment and eliminates interest charges. The payments are tax deductible, too, which reduces the item’s net cost.
Enjoy flexible lending terms. Maybe you have bad credit and can’t get a traditional loan. Most leasing companies offer flexible lending terms, giving you access to the equipment you need.
Easily upgrade. When your lease ends, upgrade to new equipment and its new technology right away instead of waiting until you save enough cash to buy an upgraded item.
Disadvantages of Leasing
Pay more overall. Leasing and its fees generally cost more than buying in the long
Forego ownership. When you lease equipment, you don’t own it and can’t build equity, which is troublesome if your business primarily uses equipment that retains its value over time.
Fulfill the lease obligation. You must fulfill the entire lease term obligation even if you no longer need or use the item. Break the lease, and you’ll owe a large early termination fee.
Benefits of Buying
Earn tax benefits. In the first year of ownership, you could deduct the full cost of the equipment you purchase. Talk to your accountant for details.
Take a depreciation deduction. You may be able to deduct depreciation on certain purchased assets.
Build equity. Because you own equipment, it counts toward your equity and can help you grow your business.
Disadvantages of Buying
Spend more money initially. To buy new equipment, you need a large down payment which can deplete cash reserves. Buying could also limit your future purchasing ability until after you repay the loan.
Pay expensive financing fees. Purchase equipment with a loan, and you’ll pay interest on the balance at a rate as high as 20 percent per month, a significant cost over time.
Accumulate obsolete technology. Certain types of equipment become obsolete as new technology is introduced, and you could be stuck with unusable and unsellable equipment. Your business could also suffer if you can't afford to upgrade to the new technology you need to operate.
Ultimately, the decision to lease or buy equipment depends on your business. Compare the benefits and disadvantages of leasing and buying as you choose the right option for you. Be sure to factor in the cost of insurance on the item, too, as you protect your investment and keep your business running economically.
Scurich Insurance Services
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