Hi, EmConger,
I am assuming you are talking about a co-op apartment you live in. Your capital contributions are not currently taxed at a federal level, rather they become part of the tax basis of your home and are part of calculating any gain or loss on the sale of your home (see this IRS publication "cooperative apartments" for more detail). Tax basis in a home, including shares in a co-op apartment, is the purchase price plus the cost of capital improvements. In a co-op, the starting point for an apartment’s basis is the amount paid for the shares in the corporation.
However, shareholders who use their apartments in a trade or business or to generate income, if the co-ops corporate documents permit such use, may also be entitled to depreciation and other deductions. Also, normal deductions such as your portion of property taxes and mortgage interest are available to you as with any other homeowner.
Hope this helps!
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Best,
Karen
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