@Opus 17 wrote:
Improvements add value to the property......”
We can argue this "improvement" point into eternity, but one thing is for certain; the "add value" language is not a part of the equation. In other words, an improvement can actually devalue the property and still be considered an "improvement" for income tax purposes. The word "value" was inserted quite some time ago by a member of this board without any reference as to where, exactly, the word appears in connection with "improvement" in the Code, Regulations, or Rules.
I have about a million examples of the foregoing, but setting forth just one would be adding an olympic-size, outdoor swimming pool to a 2-bedroom house in Fairbanks, Alaska. The cost of that "improvement" would be added to the basis of the house but would not only not add "value", but it could also actually make the property less valuable or even unsaleable.
Here, we have an estate and property held therein. As a result, Section 1.67-4 applies and, from the stated facts ("...due to the situation of the death..."), the costs incurred might not have been incurred had the property not been held in the estate. In other words, the "situation" occurred because of the death in the house and could not be remediated in a timely manner as a result of being held by the estate (rather than an individual who could have addressed the situation earlier).
[With respect to expenses that may be related to "improvements", see also Section 1.263(a)-3(g)(1)]
In the end, all we have are opinions and nothing more, including at least one earlier post which appears to be cut from whole cloth with absolutely no authority cited and, seemingly, consisting of language fabricated by what the poster felt "sounded good" (but which is almost absurd on its face).
