Repair on Foundation

3 replies
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I live in FL and I have a home in NY that is unoccupied, never been a rental and it needs $25,000 of foundation repairs. Are these repairs tax deductible?

Anonymous_Answer

Level 15

Repairs on personal use property are not deductible (only repairs on property held for business use or for the production of income qualify for that treatment).

If the work is extensive and could be considered tantamount to a new foundation, you might be better off taking the position (if warranted) that this is an improvement so that the cost could be added to the basis of the property.

Anonymous_Answer

Level 15

Repairs on personal use property are not deductible (only repairs on property held for business use or for the production of income qualify for that treatment).

drummerjeff886Author

Level 2

Thanks for the reply, simplify this line for me "the cost could be added to the basis of the property." - ultimate meaning?

Anonymous_

Level 15

If and when you sell the property, any gain (loss) will be measured by the difference between the selling price and your basis. A higher basis means less gain and, consequently, lower potential capital gains tax.