Hal_Al
Level 15

Deductions & credits

As the replies infer, it's unclear what kind of repairs you're asking about.

 

Repairs deducted in previous years are ignored.  You already got your tax break for them.  Furthermore, you do not add them back as income.  That is, repair expenses previously deducted are not "recaptured"  the same as improvement depreciation claimed in the past is recaptured* ("added back").

 

Repairs made in the year of sale can be handled in one of  two ways: 1. if the repair was made  while the unit was still in service, it is deducted on schedule E as an expense.  From a practical standpoint, if you had any rental income that year, you can deduct the expense.  2. If the repair was made after you stopped renting it, the repair cost is added to your basis as fix up expenses (expenses of sale). 

 

* Even though Depreciation is "added back" as depreciation recapture, the improvement cost is added to the cost basis.  So, it's essentially a wash. Depreciation recapture is taxed at a different capital gains rate, hence the requirement for the complicated book keeping/reporting.