LEK Management Inc

08/27/2026

𝐂𝐨𝐧𝐭𝐫𝐚𝐜𝐭𝐨𝐫𝐬: 𝐃𝐨𝐧’𝐭 𝐁𝐮𝐲 𝐄𝐪𝐮𝐢𝐩𝐦𝐞𝐧𝐭 𝐉𝐮𝐬𝐭 𝐟𝐨𝐫 𝐭𝐡𝐞 𝐓𝐚𝐱 𝐃𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧⁣
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Have you ever been told, “Buy some equipment before year-end so you can reduce your taxes”?⁣
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A tax deduction alone should 𝐧𝐞𝐯𝐞𝐫 𝐝𝐫𝐢𝐯𝐞 𝐚 𝐩𝐨𝐨𝐫 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐝𝐞𝐜𝐢𝐬𝐢𝐨𝐧.⁣
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Before spending valuable cash on equipment simply to generate a deduction, consider these three things:⁣
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1. 𝐃𝐨 𝐲𝐨𝐮 𝐚𝐜𝐭𝐮𝐚𝐥𝐥𝐲 𝐧𝐞𝐞𝐝 𝐭𝐡𝐞 𝐞𝐪𝐮𝐢𝐩𝐦𝐞𝐧𝐭?⁣
If you need the equipment now or in the near future, purchasing it may make good business sense. But spending $50,000 just to get a tax deduction doesn’t mean you saved $50,000 in taxes.⁣
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2. 𝗪𝐡𝐞𝐧 𝐰𝐢𝐥𝐥 𝐭𝐡𝐞 𝐞𝐪𝐮𝐢𝐩𝐦𝐞𝐧𝐭 𝐛𝐞 𝐩𝐥𝐚𝐜𝐞𝐝 𝐢𝐧 𝐬𝐞𝐫𝐯𝐢𝐜𝐞?⁣
Purchasing equipment and being able to depreciate it are not necessarily the same thing. Generally, depreciation begins when the equipment is placed in service—meaning it is ready and available for use in your business.⁣
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Buying equipment at year-end that isn't placed in service until the following year could affect when you can claim the depreciation deduction.⁣
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3. 𝐃𝐨𝐧'𝐭 𝐟𝐨𝐫𝐠𝐞𝐭 𝐚𝐛𝐨𝐮𝐭 𝐩𝐨𝐬𝐬𝐢𝐛𝐥𝐞 𝐝𝐞𝐩𝐫𝐞𝐜𝐢𝐚𝐭𝐢𝐨𝐧 𝐫𝐞𝐜𝐚𝐩𝐭𝐮𝐫𝐞.⁣
Taking a large depreciation deduction today doesn't necessarily mean the tax consequences disappear forever.⁣
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If you later sell the equipment for more than its adjusted tax basis, some or all of the gain may be subject to depreciation recapture. In other words, part of the tax benefit you received earlier could come back into the tax calculation when you sell the asset.⁣
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𝐏𝐫𝐨𝐭𝐞𝐜𝐭 𝐲𝐨𝐮𝐫 𝐰𝐨𝐫𝐤𝐢𝐧𝐠 𝐜𝐚𝐩𝐢𝐭𝐚𝐥.⁣
There are many legitimate strategies for reducing your tax liability that don't require making unnecessary purchases.⁣
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Before buying equipment for the tax deduction, ask yourself:⁣
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𝗪𝐨𝐮𝐥𝐝 𝐈 𝐬𝐭𝐢𝐥𝐥 𝐦𝐚𝐤𝐞 𝐭𝐡𝐢𝐬 𝐩𝐮𝐫𝐜𝐡𝐚𝐬𝐞 𝐢𝐟 𝐭𝐡𝐞𝐫𝐞 𝐰𝐞𝐫𝐞 𝐧𝐨 𝐭𝐚𝐱 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧?⁣
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If the answer is no, take another look at the strategy.⁣
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Good tax planning should support your business—not drain cash your company may need for payroll, materials, projects, and growth.⁣
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𝐀𝐧𝐚𝐥𝐲𝐳𝐞 𝐭𝐡𝐞 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐝𝐞𝐜𝐢𝐬𝐢𝐨𝐧 𝐟𝐢𝐫𝐬𝐭. 𝐓𝐡𝐞𝐧 𝐚𝐧𝐚𝐥𝐲𝐳𝐞 𝐭𝐡𝐞 𝐭𝐚𝐱 𝐛𝐞𝐧𝐞𝐟𝐢𝐭.⁣
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Here’s to your continued success and growth!

08/27/2026

Should you charge sales tax on labor, materials, or the entire contract? The answer may depend on where and what you are building.

Call now to connect with business.

08/26/2026

𝐂𝐨𝐧𝐭𝐫𝐚𝐜𝐭𝐨𝐫𝐬: 𝐘𝐨𝐮𝐫 𝐉𝐨𝐛 𝐌𝐚𝐲 𝐁𝐞 𝐅𝐢𝐧𝐢𝐬𝐡𝐞𝐝, 𝐁𝐮𝐭 𝐈𝐬 𝐀𝐥𝐥 𝐘𝐨𝐮𝐫 𝐌𝐨𝐧𝐞𝐲 𝐂𝐨𝐥𝐥𝐞𝐜𝐭𝐞𝐝?⁣
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For projects that require retainage, completing the job does not necessarily mean you have collected all the money you've earned. 5%–10% of your contract revenue could still be tied up—sometimes for months or even years.⁣
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Here are four areas contractors should pay attention to:⁣
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1. 𝐓𝐫𝐚𝐜𝐤 𝐫𝐞𝐭𝐚𝐢𝐧𝐚𝐠𝐞 𝐬𝐞𝐩𝐚𝐫𝐚𝐭𝐞𝐥𝐲.⁣
Maintain a clear breakdown of retainage by project and by each payment requisition submitted. If there is ever a question or discrepancy, you should be able to quickly identify exactly what is outstanding.⁣
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2. 𝐊𝐧𝐨𝐰 𝐲𝐨𝐮𝐫 𝐞𝐱𝐩𝐞𝐜𝐭𝐞𝐝 𝐜𝐨𝐥𝐥𝐞𝐜𝐭𝐢𝐨𝐧 𝐝𝐚𝐭𝐞𝐬.⁣
Some projects can last for years, and depending on your contract terms, retainage may not be released until substantial or final completion. Knowing when you expect to receive those funds helps you plan your cash needs instead of treating retainage as money that is immediately available.⁣
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3. 𝐔𝐧𝐝𝐞𝐫𝐬𝐭𝐚𝐧𝐝 𝐭𝐡𝐞 𝐢𝐦𝐩𝐚𝐜𝐭 𝐨𝐧 𝐜𝐚𝐬𝐡 𝐟𝐥𝐨𝐰.⁣
Retainage is money you've earned but cannot yet use to pay payroll, suppliers, subcontractors, taxes, or other operating expenses. Build retainage into your cash-flow projections and plan for other sources of working capital when necessary.⁣
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4. 𝐃𝐨𝐧'𝐭 𝐨𝐯𝐞𝐫𝐥𝐨𝐨𝐤 𝐭𝐡𝐞 𝐭𝐚𝐱 𝐢𝐦𝐩𝐚𝐜𝐭.⁣
For contractors using the accrual method of accounting for tax purposes, income may generally be recognized before the retainage is actually collected, depending on the applicable tax rules and circumstances. That can create a situation where taxes are due on income you haven't yet received in cash. Plan accordingly with your tax professional.⁣
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Finishing the project is only part of the job. Collecting the money—and planning for when you don't have access to it—is just as important.⁣
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𝐔𝐧𝐝𝐞𝐫𝐬𝐭𝐚𝐧𝐝𝐢𝐧𝐠 𝐡𝐨𝐰 𝐫𝐞𝐭𝐚𝐢𝐧𝐚𝐠𝐞 𝐚𝐟𝐟𝐞𝐜𝐭𝐬 𝐲𝐨𝐮𝐫 𝐚𝐜𝐜𝐨𝐮𝐧𝐭𝐬 𝐫𝐞𝐜𝐞𝐢𝐯𝐚𝐛𝐥𝐞, 𝐜𝐚𝐬𝐡 𝐟𝐥𝐨𝐰, 𝐚𝐧𝐝 𝐭𝐚𝐱𝐞𝐬 𝐜𝐚𝐧 𝐡𝐞𝐥𝐩 𝐩𝐫𝐞𝐯𝐞𝐧𝐭 𝐜𝐚𝐬𝐡 𝐬𝐡𝐨𝐫𝐭𝐚𝐠𝐞𝐬 𝐚𝐧𝐝 𝐮𝐧𝐞𝐱𝐩𝐞𝐜𝐭𝐞𝐝 𝐭𝐚𝐱 𝐨𝐛𝐥𝐢𝐠𝐚𝐭𝐢𝐨𝐧𝐬.⁣
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Stay ahead of the numbers. Stay ahead of the problem.⁣
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Supporting your path to lasting success!

08/24/2026

Contractors, backlog quality matters more than backlog size

08/22/2026

🚧 𝐂𝐎𝐍𝐓𝐑𝐀𝐂𝐓𝐎𝐑𝐒 — 𝐋𝐄𝐓’𝐒 𝐇𝐀𝐕𝐄 𝐀 𝐋𝐈𝐓𝐓𝐋𝐄 𝐅𝐔𝐍! 🚧⁣
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You just landed a $500,000 job. 🎉⁣
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What’s your FIRST thought?⁣
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A. 💰 “This is going to be a great year!”⁣
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B. 👷 “Do I have enough people to do this job?”⁣
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C. 😬 “How am I going to finance payroll and materials until I get paid?”⁣
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D. 📊 “What’s my actual profit going to be?”⁣
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E. 😂 “All of the above!”⁣
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Drop your answer below: A, B, C, D or E.⁣
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𝐀𝐧𝐝 𝐜𝐨𝐧𝐭𝐫𝐚𝐜𝐭𝐨𝐫𝐬…𝐢𝐟 𝐲𝐨𝐮 𝐩𝐢𝐜𝐤𝐞𝐝 𝐃, 𝐲𝐨𝐮’𝐫𝐞 𝐬𝐩𝐞𝐚𝐤𝐢𝐧𝐠 𝐦𝐲 𝐥𝐚𝐧𝐠𝐮𝐚𝐠𝐞. 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐬𝐨𝐮𝐧𝐝𝐬 𝐠𝐫𝐞𝐚𝐭, 𝐛𝐮𝐭 𝐩𝐫𝐨𝐟𝐢𝐭 𝐚𝐧𝐝 𝐜𝐚𝐬𝐡 𝐟𝐥𝐨𝐰 𝐚𝐫𝐞 𝐰𝐡𝐚𝐭 𝐤𝐞𝐞𝐩 𝐭𝐡𝐞 𝐝𝐨𝐨𝐫𝐬 𝐨𝐩𝐞𝐧.

Call now to connect with business.

08/20/2026

𝐆𝐫𝐨𝐬𝐬 𝐏𝐫𝐨𝐟𝐢𝐭 𝐅𝐚𝐝𝐞 𝐒𝐡𝐨𝐮𝐥𝐝 𝐁𝐞 𝐌𝐞𝐚𝐬𝐮𝐫𝐞𝐝⁣
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𝐀 𝐣𝐨𝐛 𝐞𝐬𝐭𝐢𝐦𝐚𝐭𝐞𝐝 𝐚𝐭 𝐚 𝟐𝟓% 𝐠𝐫𝐨𝐬𝐬 𝐩𝐫𝐨𝐟𝐢𝐭 𝐦𝐚𝐫𝐠𝐢𝐧 𝐭𝐡𝐚𝐭 𝐜𝐥𝐨𝐬𝐞𝐬 𝐚𝐭 𝟏𝟐% 𝐢𝐬 𝐭𝐞𝐥𝐥𝐢𝐧𝐠 𝐲𝐨𝐮 𝐬𝐨𝐦𝐞𝐭𝐡𝐢𝐧𝐠 𝐢𝐦𝐩𝐨𝐫𝐭𝐚𝐧𝐭.⁣
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The wider the gap between estimated Gross Profit Margin (GPM) and actual GPM, the more concerned a contractor should be. That gap—often referred to as profit fade—should trigger a review of the job financials to determine what went wrong and, more importantly, how to prevent it from happening again.⁣
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Here are three areas contractors should focus on:⁣
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1. 𝐄𝐬𝐭𝐢𝐦𝐚𝐭𝐢𝐧𝐠 𝐞𝐫𝐫𝐨𝐫𝐬⁣
Repeated estimating mistakes can quickly erode a company’s profitability. Review completed jobs against the original estimate to identify where assumptions, quantities, labor hours, or costs were missed. Catching patterns early can improve future bids and protect margins.⁣
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2. 𝐏𝐮𝐫𝐜𝐡𝐚𝐬𝐢𝐧𝐠 𝐚𝐧𝐝 𝐦𝐚𝐭𝐞𝐫𝐢𝐚𝐥 𝐜𝐨𝐬𝐭𝐬⁣
The time between bidding a project and purchasing materials can be months—or sometimes more than a year. During that time, prices can increase significantly and eat away at project profits. Build appropriate cushions or escalation provisions into material pricing whenever possible.⁣
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3. 𝐏𝐨𝐨𝐫 𝐜𝐡𝐚𝐧𝐠𝐞-𝐨𝐫𝐝𝐞𝐫 𝐦𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭⁣
Change orders are inevitable, but losing money on them doesn’t have to be. Document the additional work, obtain approval before the work is performed whenever possible, get the required signatures, and—most importantly—make sure the change order gets invoiced.⁣
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Profit fade shouldn't just be discovered at year-end.⁣
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Track estimated vs. actual GPM throughout the project and perform a financial and administrative closeout on every completed job. The information you uncover can help you bid smarter, manage projects better, and build a financially stronger contracting business.⁣
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𝐁𝐞 𝐚𝐧 𝐚𝐜𝐭𝐢𝐯𝐞 𝐩𝐚𝐫𝐭𝐢𝐜𝐢𝐩𝐚𝐧𝐭 𝐢𝐧 𝐲𝐨𝐮𝐫 𝐧𝐮𝐦𝐛𝐞𝐫𝐬. 𝐓𝐡𝐞𝐲 𝐚𝐫𝐞 𝐭𝐞𝐥𝐥𝐢𝐧𝐠 𝐲𝐨𝐮 𝐭𝐡𝐞 𝐬𝐭𝐨𝐫𝐲 𝐨𝐟 𝐲𝐨𝐮𝐫 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬.

08/19/2026

Contractors, materials and field labor are not only costs your jobs must cover. Include vehicles, office payroll, insurance, software, licensing, rent, marketing and accounting.

08/18/2026

𝐂𝐨𝐧𝐭𝐫𝐚𝐜𝐭𝐨𝐫𝐬: 𝐇𝐚𝐬 𝐭𝐢𝐠𝐡𝐭 𝐜𝐚𝐬𝐡 𝐟𝐥𝐨𝐰 𝐟𝐨𝐫𝐜𝐞𝐝 𝐲𝐨𝐮 𝐭𝐨 𝐮𝐬𝐞 𝐩𝐚𝐲𝐫𝐨𝐥𝐥 𝐭𝐚𝐱 𝐟𝐮𝐧𝐝𝐬 𝐭𝐨 𝐜𝐨𝐦𝐩𝐥𝐞𝐭𝐞 𝐲𝐨𝐮𝐫 𝐜𝐮𝐫𝐫𝐞𝐧𝐭 𝐩𝐫𝐨𝐣𝐞𝐜𝐭𝐬?⁣
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Payroll taxes include “trust fund” taxes—federal income tax withheld from employees and the employees’ share of Social Security and Medicare taxes—plus the employer’s share of Social Security and Medicare taxes.⁣
These taxes generally must be deposited monthly or semiweekly. For larger payroll liabilities, the deposit may be due the next business day. Missing a deadline can trigger failure-to-deposit penalties and interest. 𝐑𝐞𝐬𝐩𝐨𝐧𝐬𝐢𝐛𝐥𝐞 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐨𝐰𝐧𝐞𝐫𝐬 𝐚𝐧𝐝 𝐨𝐭𝐡𝐞𝐫 𝐢𝐧𝐝𝐢𝐯𝐢𝐝𝐮𝐚𝐥𝐬 𝐦𝐚𝐲 𝐚𝐥𝐬𝐨 𝐛𝐞 𝐡𝐞𝐥𝐝 𝐩𝐞𝐫𝐬𝐨𝐧𝐚𝐥𝐥𝐲 𝐥𝐢𝐚𝐛𝐥𝐞 𝐟𝐨𝐫 𝐮𝐧𝐩𝐚𝐢𝐝 𝐭𝐫𝐮𝐬𝐭 𝐟𝐮𝐧𝐝 𝐭𝐚𝐱𝐞𝐬.⁣
The cost of missed payroll tax deposits can escalate quickly, placing even more pressure on your cash flow. 𝐈𝐟 𝐭𝐡𝐞 𝐛𝐚𝐥𝐚𝐧𝐜𝐞 𝐫𝐞𝐦𝐚𝐢𝐧𝐬 𝐮𝐧𝐫𝐞𝐬𝐨𝐥𝐯𝐞𝐝, 𝐭𝐡𝐞 𝐈𝐑𝐒 𝐦𝐚𝐲 𝐩𝐮𝐫𝐬𝐮𝐞 𝐜𝐨𝐥𝐥𝐞𝐜𝐭𝐢𝐨𝐧 𝐚𝐜𝐭𝐢𝐨𝐧𝐬, 𝐢𝐧𝐜𝐥𝐮𝐝𝐢𝐧𝐠 𝐥𝐢𝐞𝐧𝐬 𝐚𝐧𝐝 𝐥𝐞𝐯𝐢𝐞𝐬.⁣
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Protect your business, your projects, and your peace of mind. 𝐃𝐞𝐯𝐞𝐥𝐨𝐩 𝐫𝐞𝐥𝐢𝐚𝐛𝐥𝐞 𝐜𝐚𝐬𝐡-𝐟𝐥𝐨𝐰 𝐩𝐫𝐨𝐣𝐞𝐜𝐭𝐢𝐨𝐧𝐬 𝐚𝐧𝐝 𝐬𝐞𝐜𝐮𝐫𝐞 𝐚𝐩𝐩𝐫𝐨𝐩𝐫𝐢𝐚𝐭𝐞 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐧𝐠 𝐛𝐞𝐟𝐨𝐫𝐞 𝐩𝐚𝐲𝐫𝐨𝐥𝐥 𝐭𝐚𝐱 𝐟𝐮𝐧𝐝𝐬 𝐚𝐫𝐞 𝐮𝐬𝐞𝐝 𝐟𝐨𝐫 𝐨𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐞𝐱𝐩𝐞𝐧𝐬𝐞𝐬.⁣
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To your success and peace of mind!⁣

08/17/2026

Contractors, work-in-progress reports can reveal a fading profit margin.

Call now to connect with business.

08/12/2026

How and when a contractor recognizes revenue can materially change the tax return

Call now to connect with business.