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vgranados-92
New Member

I am building a house in El Salvador. Can I claim the expenses on my taxes?

 
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Opus 17
Level 15

I am building a house in El Salvador. Can I claim the expenses on my taxes?

Expenses to buy or build a home are never tax deductible.  

If you were building a structure for business, you would take a deduction for depreciation over 27.5 (or more) years, but you also pay recapture tax when you sell.  

For a personal residence, the expenses are not deductible and you don't take depreciation, but when you sell, you only pay income tax on the gain (profit; amount the property has increased in value over your original cost), instead of paying tax on he entire sales proceeds. 

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*

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4 Replies
rjs
Level 15
Level 15

I am building a house in El Salvador. Can I claim the expenses on my taxes?

Are you building the house for you to live in yourself or to use as a vacation home, or are you planning to rent it out or sell it?
vgranados-92
New Member

I am building a house in El Salvador. Can I claim the expenses on my taxes?

To live in for my self. As well as travel so I will always have a home to come back to. I am a US Citizen.
vgranados-92
New Member

I am building a house in El Salvador. Can I claim the expenses on my taxes?

Thank you
Opus 17
Level 15

I am building a house in El Salvador. Can I claim the expenses on my taxes?

Expenses to buy or build a home are never tax deductible.  

If you were building a structure for business, you would take a deduction for depreciation over 27.5 (or more) years, but you also pay recapture tax when you sell.  

For a personal residence, the expenses are not deductible and you don't take depreciation, but when you sell, you only pay income tax on the gain (profit; amount the property has increased in value over your original cost), instead of paying tax on he entire sales proceeds. 

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*

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