Home sale cost basis question

[22clwilliams]

Hello - We sold our primary residence in 2021.  I'm working on calculating the cost basis, including the improvements made to the home.   When we moved in, the 1922 home had an unfinished, wide open basement.  A contractor installed a bath and laundry room.  With permits, we finished the remainder of the space into an office, rec room, and hallway with closet.  We are not contractors, but we do nice work (if I say so myself).  Our hard costs included electrical materials, framing, drywall, paint and flooring.  Can we include a labor charge for the hours we put in finishing the basement?  If a contractor had finished the basement, we'd be able to deduct labor.  Can we come up with a fair price for our labor and use it on our cost basis calculations?  

[VolvoGirl · Accepted solution]

Sorry no.  Not your own labor.   Just your actual costs out of pocket.

[Bsch4477]

No. Your labor can never be included in the cost of a capital improvement. Similarly, your labor can’t be included in the amount of a charitable deduction. 

[Hal_Al]

I assume you are aware that the first $500,000 (Married filing jointly) of capital gains on the sale of your primary  home is usually excludable from your income.  If not reply back for more info.

[22clwilliams]

Thank you, all.