I’m a bad businessman-how do I bill for labor?

My brother in law recently inherited a BEW Golf TDI and told me he'd pay me to get it roadworthy. In the past when ive done work for a friend, I've just charged parts cost plus a 6 pack of beer, but my BIL stressed that he wanted to compensate me fairly for my time. I'm no professional, so I don't think charging a shop rate is fair, and even though I think he truly is serious about paying me fairly, the family aspect makes this even trickier for me. 
 

I'm in this job for about $350 in parts plus 6 hours of labor. I replaced the DS Lower control arm, sway bar link, wheel bearing (press in type), hub, hood strut, turbo oil return line and gasket, side markers, restored the headlights, and checked/adjusted the front toe since I had to lower the subframe to get the control arm out. 
 

Like the title says, I'd make an awful businessman. Id go bankrupt in a week if I had to make a living this way because I've got no concept of what my time's worth. I feel pretty foolish asking this, but any  thoughts on what to charge here? 

Probably $40 - $60 / hour.

I can't tell you what to charge him but you could probably find book time to perform all those repairs just so you had a reference. Same thing in the parts of you got them cheaper than full retail. 

You could tell him this is what it would have costs, I'll take .... ? Half, quarter? $350 and a six pack? The family part certainly makes that more complex. 

This may or may not be helpful: Back in college, I got a professor's MG TD back on the road after a few decades of sitting. Similar deal: "charge me a fair rate" but I was not a professional. I knew him fairly well after taking a few classes, but we weren't particularly close or anything.

At the end of the project, IIRC I charged him $50/hour for labor plus parts cost, totaling a grand or two to get the car back on the road. Even a decade ago that was half or 1/3 what he'd pay at a shop, but a life changing amount of money for me as a poor college student, and everybody seemed to walk away happy. I did odd jobs on the car (new steering wheel, oil change, etc.) for a year or so afterwards at the same rate, so apparently he was happy.

I vividly remember finally being able to buy a new radiator for my old diesel Mercedes after one trip to work on the MG, which was great because I'd been driving around with duct tape and JB weld holding the plastic end tank together for a week. 

If you told me "it was $350 in parts, so double that and I'm good" I'd be in. I don't think you need to get into $x per hour. 

Do not short change yourself. Charge him whatever it takes to make you not feel taken advantage of. Because if you are fair,  and do good work, you know he is going to be back for more. 

People doing work out of their garage are seldom going to be as efficient as a mechanic working out of a well equipped shop. So even at half shop rate you might burn a lot of hours, best to do the calculation at the end and say 'brakes are parts plus $100 in my pocket" or whatever  $$$ makes you happy to have done the work.

I wont touch relatives vehicles. I neither want to become the family mechanic nor do I want to hear about it at every family event if anything goes wrong.

Ultimately it's kind of arbitrary when you're not a pro, but what's your hourly rate at your normal job?  You could use that.

Note that you are probably technically required to report this income and pay taxes on it.  While it's unlikely that it would ever come up in an audit, If it were me I'd see if I could get a favor in return of some kind instead of cash just to avoid those sorts of questions.

Without knowing your BIL, this is only a suggestion. 

If it was me an one of my BIL, I'd be up front, tell him how much the parts were, how many hours and the hourly rate your charging and ask him if it sounds fair.  I've handled it this way in the past and everyone walks away feeling like they got a fair deal. 

As for the hourly rate, there's a couple ways you can handle it, but here's one way and the rationale. Look at the local shop rates and then charge between 1/3 - 1/2 of their rates. Fine tune it based on the level of rust and aggravation. I'm guessing this will put you in the $40-60 range Beer Baron suggested. 

The reason for this is you don't have the overhead shops are covering as part of their  rate, you won't be paying taxes on this (even if you felt guilty about it, the income should be under the $600 threshold for requiring it to be reported in a 1099, since part cost isn't income), and you want to get something for your time without taking advantage of him. 

When figuring out your time, don't forget time spent running to get parts. It's not time working on the car, but it's time you could have been doing something else. 

If it were me, even $100 and be don.e

A shop is going to charge $120+ per hour. If you charge half that, he's money ahead. 

If you really like him, charge 1/3rd. 

In reply to NOHOME :

"I wont touch relatives vehicles. I neither want to become the family mechanic nor do I want to hear about it at every family event if anything goes wrong."

This^ You will own it from now on. If the wheel falls off 10 years from now, it's your fault.

Get a flat rate price from a shop, find out their hourly rate.   

Divide to figure out the hours for the quote. 

Figure out what per hour you want to charge.

I've done a couple little side jobs for people in the past and I'd figure out what it was worth to me to spend my time doing the job and price it accordingly.  For example, one guy had an S10 that he wanted a new engine put in.  He had been paying another guy on the side to do it, but that guy was, uhm, not good, and couldn't get the old engine out of the truck.  He wanted me to include Doofus McGee in the process and "let him help", but I put my foot down on that.  I told him I'd finish the job up for $750 plus whatever additional parts were needed.  When he attempted to negotiate and basically asked for an hourly rate with an NTE, I told him that this was my hobby, not my job, and the price I quoted was basically what I would need to cover the opportunity cost of not doing fun things.  And, by the way, I don't do checks or venmo or anything that leaves a paper trail.  He paid my price.

A couple other folks had smaller things that needed to be done and if I could get a labor estimate from repairpal or something, I'd take about half of that off.  Where it would get tough, though, is something that wasn't very labor intensive.  One guy kept asking me to do oil changes for him, but I had to keep telling him that in order to make it worth my time to screw with it - drive out to the shop at a certain time to meet him, pull the car in, put it up on the lift, do the things, pull it back out, then make the chitchat, close up, and drive back home - I'd have to charge him at least 3x what any quicklube place would charge.  I'd rather sit at home and watch a movie with the wife than have $20.

You've also gotta be upfront about what you're doing and explain that you're cheap because you get what you pay for.  There's no warranty, no paper trails, no insurance against screwing up your car, and even though you're a "paying customer" I have a day job and a family that takes priority so be prepared to wait.

In reply to NOHOME :

In 1999 I gave my brother-in-law a free car - 1987 Lincoln Towncar - 125,000 miles worth maybe $1500 at the time.  

He complained later the alignment was off on the car I gave him and wore the tires prematurely thus burning thru tires quickly costing him. 

Then I became the free car Nazi.  No free car for you. 

Datsun240ZGuy said:

In reply to NOHOME :

In 1999 I gave my brother-in-law a free car - 1987 Lincoln Towncar - 125,000 miles worth maybe $1500 at the time.  

He complained later the alignment was off on the car I gave him and wore the tires prematurely thus burning thru tires quickly costing him. 

Then I became the free car Nazi.  No free car for you. 

Precisely why I always refused to work on friends/family cars (that weren't racing buddies when we working on the track cars), because of that. 

Something goes wrong, my fault or not, unrelated or not, now I'm responsible for fixing it or a bad guy because I won't. 

"No good deed goes unpunished."

I won't touch relatives vehicles. I neither want to become the family mechanic nor do I want to hear about it at every family event if anything goes wrong.

SO this!