Construction is one of the few industries where the accounting method itself drives tax strategy. Most CPAs default to whatever was easiest at formation.
Percentage-of-completion vs. completed-contract method changes tax timing materially. Section 460 rules are nuanced, and the right answer depends on contract type and revenue size.
Job-level profitability matters more than top-line revenue. Most contractors run their accounting at the company level and lose visibility into which projects actually made money.
Sureties look at WIP schedules, retainage, and working-capital ratios that most general accounting does not produce — limiting bonding capacity and the project sizes the firm can bid.
Heavy equipment, vehicles, and specialty tools carry significant depreciation timing decisions — § 179, bonus depreciation, recapture — that drive multi-year tax outcomes.
Construction accounting is its own discipline — and we have built the firm to handle it.
POC vs. completed-contract analysis under § 460, cash vs. accrual, small contractor exemption thresholds, and method-change planning.
Project-level revenue and cost tracking, WIP schedules, over/under billings, and project profitability reporting.
CPA-prepared financials at the level sureties expect — WIP schedules, working-capital analysis, and the supporting schedules that drive bonding capacity.
Section 179 and bonus depreciation modeling, vehicle depreciation, recapture planning, and trade-in analysis.
Contractor classification analysis, 1099 issuance, and California-specific worker-classification rules (AB 5 implications).
For firms working across state lines — nexus analysis, multi-state filings, and prevailing-wage compliance coordination.
Construction accounting sits at the intersection of revenue recognition rules that exist nowhere else, bonding requirements that affect bid eligibility, and equipment tax strategy that compounds over the life of the firm. A general-practice CPA can prepare the return, but the strategic work — method selection, WIP reporting, equipment timing — is where specialty depth changes outcomes.
A complimentary 30-minute consultation. We review your situation and tell you honestly whether Milestone is the right firm.
