GREEN ISLAND, NY, Feb 06, 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 Jim Long, Broker/Owner of Coldwell Banker Prime Properties, “but only after you have sold your home.” So while you may not be able to claim these deductions this year, Long 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 Long, 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 Long. 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 Coldwell Banker Prime Properties at RENews@ColdwellBankerPrime.com, 866-323-2277, or Coldwell Banker Prime Properties.