Collapsed sewer pipe

[Grebin]

I am trying to figure out for my son the best way for him to file taxes next year with deductions.

He has 2 years into new owned home (originally built in 1963) and he will be putting in $17k worth of replaced sewer pipe that is bigger and no longer deteriorated tiny cast-iron pipe.

Its a major change and we will help him and his joint filing wife as needed with paying for it. The question is how to best reduce the burden of this work and future major repairs on him, when they are clearly improvements that are non-cosmetic and add value.

- G

[Bsch4477]

There’s no deduction for that assuming it’s his home. The expense increases the cost basis of his home. 

[Mike9241]

Personal preference. While paying for part of the sewer directly is ok and gives him basis (as a gift) it might make it easier for him, if audited,  if you gave him the cash and he paid for it.  If he were to sell in the future he would have the proof that he incurred the expense and paid for it.   also, be aware that regardless of whether you pay for it directly of give him the cash these are gifts and if the value is more than $17K for 2024 you should be filing a gift tax return Form 709. Turbotax does not do this form.