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Returning Member
posted Mar 11, 2023 7:12:26 PM

Can I deduct remodeling/restoration expenses from the previous year in filing 2022 returns?

I have a rental property (secondary home), bought in 2021 and paid $25k to restore the property (paining, floor update) etc and rented it out in 2022. Since I didn't rent it out in 2021, I didn't claim in tax deductions, but can I include it in 2022 rental property tax deduction?

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2 Replies
Expert Alumni
Mar 11, 2023 7:45:37 PM

No, unfortunately you cannot deduct the preparation expenses you incurred in a prior year before the rental was placed in service.  You can add the costs to the basis of your property, which can be deducted as depreciation.  

 

Per the IRS: To figure your property's basis for depreciation, you may have to make certain adjustments (increases and decreases) to the basis of the property for events occurring between the time you acquired the property and the time you placed it in service for business or the production of income. The result of these adjustments to the basis is the adjusted basis.

Returning Member
Mar 11, 2023 9:49:01 PM

Thanks. Turbotax had given this option "Enter non-deductible expenses from the prior years".  Which is why i thought whether it is possible to claim the expenses that i didn't do in 2021 as I hadn't not rented it out as repair work was going on.