Splitting Costs Between Clinic and Mobile Service

To manage expense costs effectively for your small veterinary clinic, it's essential to understand how to split and deduct expenses between the fixed clinic and mobile service. A key aspect is to determine which costs are directly attributable to the mobile unit, as these expenses will be subject to different tax rates. For the bigger picture, see our guide to expense management for veterinary clinics.

Tax Implications and Compliance

To be eligible, the mileage must be driven for business purposes and not for personal use.

The relief veterinarians must also consider the tax implications of their business expenses. Under the OBBBA, qualified business use percentages can be claimed against the total expenses of the business. The relief veterinarians can claim a percentage of their business expenses, such as equipment, supplies, and insurance, against their business use percentage. However, the relief veterinarians must not exceed the qualified business use percentage for their mobile unit.

Special Considerations and Compliance

For shared expenses, the business must ensure that they are being accounted for accurately and that the correct percentage of costs are allocated to each unit. This can be challenging, especially when expenses are incurred regularly across both the clinic and mobile service.

This means that the business can immediately deduct the full cost of equipment and vehicles acquired for the mobile unit, providing a significant tax benefit.

By following the right procedures and documentation, businesses can minimize their tax liability and maintain accurate financial records for both their clinic and mobile service operations.

Tax rules, limits and rates change. Confirm current figures with the IRS or your accountant before you file.

This means that the cost of the vehicle can be deducted without any phase-out period, resulting in significant tax savings for mobile veterinary practices.

Mobile veterinary practices require a state veterinary license, a controlled substance license, and potentially a permit for the vehicle itself. Additionally, Florida requires a premises permit for any establishment, permanent or mobile, where a licensed veterinarian practices, with a fee not exceeding $250 for 2026.

• Keep accurate records of the vehicle's cost, including receipts and invoices.
• Ensure that the vehicle is properly registered and licensed in each state and locality where it operates.
• Comply with any local and state regulations regarding premises permits and licenses.
• Consult with a tax professional or accountant to ensure compliance with all applicable tax laws and regulations.

Vehicle Costs and Depreciation

This means that a qualifying vehicle can be depreciated entirely in the first year.

Alternatively, actual vehicle expenses such as gasoline, maintenance, repairs, insurance premiums, and depreciation or lease payments can be deducted.

For example, let's say you have a 2025 vehicle that weighs over 6,000 pounds.

It's essential to keep accurate records of vehicle expenses, including receipts, invoices, and bank statements.