What expense category is Grease Trap Cleaning and Maintenance?

For any commercial kitchen, regular grease trap cleaning and maintenance is not just a best practice for plumbing—it's often a legal requirement mandated by local health and sanitation codes. The fees paid to a professional service for pumping and maintaining your grease trap are a routine and unavoidable cost of doing business.

For restaurant owners and their accountants, it is important to know that these service fees are a fully deductible business expense. This guide will clarify how to categorize these costs according to IRS rules to ensure your restaurant's financial reporting is accurate and compliant.

Grease Trap Cleaning and Maintenance Category

The fees you pay for routine grease trap cleaning and maintenance are an ordinary and necessary business expense. These costs are reported under the specific category of Repairs and Maintenance.

IRS Publication 535 allows for the deduction of costs that keep your business property in a normal, efficient operating condition. Regular cleaning and maintenance of your grease trap is a perfect example of this type of deductible repair.

Important Considerations While Classifying Grease Trap Cleaning and Maintenance

The most critical factor is distinguishing between a deductible maintenance service and a non-deductible fine or a capital improvement.

Deductible Maintenance vs. Non-Deductible Fines

• Deductible Maintenance Fee: The recurring fee you pay to a professional service for cleaning your grease trap is a deductible repair and maintenance expense.
• Non-Deductible Fine: If you fail to maintain your grease trap and are fined by the health department or another government agency for non-compliance, that fine is not deductible. IRS Publication 535 is very clear that you generally cannot deduct fines or penalties paid to a government for the violation of any law.

Maintenance vs. Capital Improvement

It is also important to distinguish between routine service and a major upgrade.

• Maintenance: Regular cleaning and minor repairs are a current expense.
• Improvement: The cost of purchasing and installing a new, larger, or more advanced grease trap is a capital expenditure. As explained in IRS Publication 946, this cost must be capitalized and recovered over time through depreciation.

Tax Implications and Recordkeeping

To deduct your grease trap service fees, you must report them correctly and maintain proper documentation.

How to Report the Deduction

For a sole proprietor filing a Schedule C (Form 1040), the costs for grease trap cleaning and maintenance are deducted on Part II, Line 21, Repairs and maintenance.

What Records to Keep

You must have documentary evidence to substantiate your expenses. Your records for grease trap services should include:

• The service agreement with the maintenance company.
• Invoices from the provider detailing the service dates and charges.
• Proof of payment, such as canceled checks or credit card statements.

How Fyle Can Automate Expense Tracking for Grease Trap Maintenance

Fyle simplifies the management of your recurring facility maintenance invoices, ensuring every payment is captured, coded, and ready for tax time.

• Centralize Invoices: Forward or attach your grease trap service provider's invoices directly to Fyle for automatic and accurate data capture.
• Track Recurring Services: Fyle’s real-time credit card feeds can instantly capture recurring maintenance fees paid on a business card.
• Create a Clear Audit Trail: Fyle keeps the service agreement, all invoices, and proofs of payment together in one easily accessible digital record.
• Automate Your Accounting: Sync the categorized maintenance expense directly to the correct GL account in QuickBooks, Xero, NetSuite, or Sage Intacct.