Cleaning Services
Bookkeeping and payroll for cleaning businesses with worker classification handled right by a CPA and Enrolled Agent.
The Industry
Worker classification is the biggest risk most cleaning business owners don’t think about until it’s too late. The IRS and state agencies know that cleaning companies often treat workers as 1099 contractors when they should be W-2 employees. A crew member who works your schedule, uses your supplies, and follows your procedures is almost certainly an employee under IRS guidelines. If you’ve been paying them as a contractor to avoid payroll taxes and workers’ comp, you’re sitting on a liability that can include back taxes, penalties, interest, and the employee’s share of FICA that you’ll have to cover yourself.
Beyond the classification question, cleaning businesses deal with recurring monthly contracts, multiple crews working different routes, and supply costs that eat into margins more than most owners realize. The business model creates predictable revenue on paper, but the profitability varies wildly by account. A $600 monthly contract looks healthy until you account for the drive time, the labor hours, and how much solution and supplies actually go into that building every week.
Who This Covers
Who This Covers
Commercial janitorial companies, residential house cleaning, pressure washing, and window cleaning. Any cleaning business in New England or nationwide with recurring contracts, cleaning crews, or a mix of employees and subcontractors.
What Complicates It
What Complicates It
Worker classification that the IRS scrutinizes closely. Payroll for crews with varying hours and locations. Recurring contract revenue that needs proper tracking. Supply costs that should be allocated by account. Route efficiency that determines whether an account actually makes money after you factor in drive time and labor.
What We Handle
Simona is a CPA and Enrolled Agent, which matters when your business has classification and payroll tax questions. The IRS uses specific tests to determine whether a worker is an employee or contractor. We help you understand how your workers should be classified and handle the payroll accordingly. For employees, that means calculating wages, withholding taxes, making deposits, and filing quarterly returns. For legitimate contractors, it means tracking payments and preparing 1099s at year end. Getting this right from the start is far cheaper than fixing it after an audit.
The bookkeeping side gives you visibility into which accounts and routes actually make money. We track revenue and costs by account so you can see the real margin on each contract after labor, supplies, and drive time. Recurring monthly contracts get recognized properly over the service period. Supply costs get allocated to jobs instead of lumped into a single expense line that hides where the money is going. You end up with books that tell you something useful about the business.
Payroll and Classification
Payroll and Classification
Worker classification evaluated properly with a CPA and Enrolled Agent behind it. Payroll processed each pay period with taxes calculated and deposited correctly. Quarterly payroll tax filings handled. Year-end W-2s for employees and 1099s for contractors who legitimately qualify. The compliance side taken off your plate and done right.
Profitability by Account and Route
Profitability by Account and Route
Revenue tracked by contract and account. Labor costs allocated to specific jobs. Supply expenses assigned to the accounts that use them. Route analysis showing which geographic areas generate profit and which involve too much driving relative to the revenue. Monthly reports that show the real performance of the business.
Common Problems
The classification mistake is the one that can hurt the most. Cleaning business owners often pay workers as 1099 contractors because it seems simpler and cheaper. No withholding, no payroll taxes, no workers’ comp premiums. But the IRS has clear criteria for contractor status, and most cleaning crews don’t meet them. When you tell someone where to go, what time to be there, how to clean, and you provide the supplies, that’s an employee. If you get audited and the IRS reclassifies those workers, you owe back employment taxes for both the employer and employee shares, plus penalties and interest. Some owners find themselves owing tens of thousands they didn’t plan for.
The other problem is flying blind on profitability. You know total revenue for the month and you know payroll went out, but you don’t know which accounts make money after all costs. That commercial building paying $800 a month might be your best contract or your worst. Without tracking labor hours, drive time, and supplies by account, you can’t tell. Owners end up holding onto unprofitable contracts for years because the monthly check feels good, even though the numbers don’t work.
Worker Misclassification Risk
Worker Misclassification Risk
Treating employees as contractors to save on payroll taxes and workers’ comp. The savings disappear when you get caught. Back taxes include the employer’s FICA share plus the employee’s share you should have withheld. Add penalties and interest and the bill can be devastating. State agencies are looking for this, and cleaning is an industry they know to check.
No Visibility Into What Makes Money
No Visibility Into What Makes Money
Monthly contracts that look profitable on the surface. No tracking of labor hours, drive time, or supplies by account. A contract that brings in $500 a month might cost $450 to service once you factor in everything. You keep servicing it because you never ran the numbers. Meanwhile you’re turning down new leads because you think you’re at capacity.
What Changes
Workers get classified correctly from the start, with a CPA and Enrolled Agent making sure the determination holds up. Payroll runs on schedule without you spending hours on it. Taxes get deposited on time. Quarterly filings go out without a scramble. You stop worrying about whether you’re doing it right because someone with the credentials and knowledge is handling it. If questions come up from the IRS or a state agency, Simona can represent you directly as an Enrolled Agent.
The books show you which accounts and routes actually make money. You can see the margin on each contract after labor, supplies, and drive time. Pricing decisions become data-driven. You know which accounts to keep, which need a rate increase, and which aren’t worth the windshield time. Growth becomes intentional because you understand the real economics of adding another crew or another route.
Classification Done Right
Classification Done Right
Workers classified properly with documentation that supports the determination. Payroll handled by a CPA and Enrolled Agent who understands the rules. Employment taxes calculated and deposited correctly. Quarterly filings and year-end forms completed on time. The compliance risk addressed instead of ignored.
Data to Make Decisions
Data to Make Decisions
Profitability visible by account and route. Contracts priced based on actual costs, not guesses. Unprofitable work identified and addressed through repricing or dropping. Capacity understood so you know when to add crews and when you’re already maxed. A clear financial picture you can plan around.
New England's CPA-Led Bookkeeping Partner
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