BOULDER, CO, Feb 07, 2016—Tax season is lurking right around the corner. As April approaches, many homeowners are wondering if their 2015 home improvements are tax deductible. The answer, however, is not so easy.
“Major home improvements are tax deductible,” says Phil Boren, Broker Associate of RE/MAX of Boulder, Inc., “but only after you have sold your home.” So while you may not be able to claim these deductions this year, Boren suggests you keep track of all improvements for the day you decide to sell.
But are you able to deduct all home improvements? According to the IRS, a tax-acceptable improvement is defined as one that adds value to your home, "considerably" prolongs your home's useful life, or adapts your house to new uses.
What improvements fall into this category? Examples, according to Boren, include new plumbing or wiring, or adding a bathroom. So while you can write off that first floor half bath, your new patio and swimming pool set-up likely won't count.
“If the work done on the home is purely for maintenance, the cost cannot be deducted and generally cannot be added to the basis, or value, of your home,” explains Boren. However, repairs done as part of an extensive remodeling or restoration of your home are considered improvements and, therefore, pass the deductible test.
For more real estate information, please contact RE/MAX of Boulder, Inc. at firstname.lastname@example.org, 303-441-5647, or RE/MAX of Boulder, Inc..
Phil Boren is a 26-year veteran real estate Broker and Realtor, specializing in consulting with buyers and sellers in Boulder, CO and along the Front Range of Northern Colorado. Held Real Estate Broker's license in Texas, California and Colorado; Managing Broker for over 200 agents and Brokers for Century 21 and RE/MAX franchises. Award-winning Realtor with experience in management, sales, marketing, relocation, appraisal, REO, BPO's, foreclosures, short sales; previously held the MAI designation from the Appraisal Institute. Experienced in both residential and commercial real estate and achieved the No. 14 individual ranking in the 5-state, Mt. States Region for RE/MAX International in 2001, based on sales volume. Received my BSBA in Finance and Real Estate from the University of Arkansas in Fayetteville, where he was a 4-year starter and 4-year football letterman for Hall-of-Fame coach, Lou Holtz.