Can I deduct the cost of $224,118.00 for a separate adu I built in 2018 on my house property?

[DawnC0 · Accepted solution]

No, but you can add that amount to the basis of your property to lower or reduce any gain you may owe when you sell the property.  

[parker-boubel]

I am planning to build an ADU on my property. I have not started because I'd like to be able to write off the cost to build it. If I create an LLC for the ADU, can i deduct the construction cost? 

[NCperson]

the costs become additons to your cost basis.  Upon sale it will help determine your profit / loss on the property.  LLC won't change that.

Think about it - if you could simply write off all the construction costs, everyone in the America would be constructing ADUs so that the federal government is helping out on each and every unit.  Not the way tax policy works. 

[Critter-3]

If this will be a rental then the cost of the build will be depreciated over a set number of years  as the IRS requires but you cannot just expense it all in one tax year.