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Hello, I had a lot of work done to my house. Can I add when filing my taxes?

Windows replaced, Roof and Siding replaced, work done inside the house.
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Hello, I had a lot of work done to my house. Can I add when filing my taxes?

You never get tax breaks for repairs.  Repairs keep the property as-is or restore damage to as-was and are the responsibility of every responsible home owner.

 

Improvements add to the value of the home or extend it's useful life.  Improvements add to the cost basis of the home and may reduce your capital gains when you sell, but are not immediate tax deductions.

 

Certain energy-saving improvements are eligible for tax credits. The "Nonbusiness energy property credit" is 10% of the cost of insulation, efficient doors and windows, and efficient furnace, heat pump, hot water heater, air conditioner, or pellet stove.  There is a lifetime maximum of $500, and some other limitations.  This credit expired at the end of 2021, so it's not available any longer unless Congress renews it.

 

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2 Replies

Hello, I had a lot of work done to my house. Can I add when filing my taxes?

You never get tax breaks for repairs.  Repairs keep the property as-is or restore damage to as-was and are the responsibility of every responsible home owner.

 

Improvements add to the value of the home or extend it's useful life.  Improvements add to the cost basis of the home and may reduce your capital gains when you sell, but are not immediate tax deductions.

 

Certain energy-saving improvements are eligible for tax credits. The "Nonbusiness energy property credit" is 10% of the cost of insulation, efficient doors and windows, and efficient furnace, heat pump, hot water heater, air conditioner, or pellet stove.  There is a lifetime maximum of $500, and some other limitations.  This credit expired at the end of 2021, so it's not available any longer unless Congress renews it.

 

Carl
Level 15

Hello, I had a lot of work done to my house. Can I add when filing my taxes?

All that you listed are property improvements, and are added to the cost basis of your house.

If this is your primary residence, then absolutely nothing concerning this gets reported anywhere on any tax return, until the tax year one of three things happens in your life.

1) You convert the property to a rental or some other type of business use, to include claiming a home office for a business that you own.

2) You sell the property

3) You die. (Your heirs get a step-up in cost basis, which takes into consideration the cost/value of your property improvements.)

 

 

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