Guide to the Best Tax Deductible Home Improvement Projects
Did you know that some home renovations could save you money on taxes? That is right; there are tax deductible home improvement projects. Home repairs and improvement projects have one thing in common; both boost the functionality of your property. However, when it comes to projects that make sense for the tax, you can count on home improvements. You only need to keep the receipts. So what is the difference? When you check on the IRS, repairs are the simple projects you do to fix your home and keep it running. On the other hand, home improvements are projects that boost your house’s value, extend its life, or modify your house to accommodate new uses.
For example, if a faucet breaks and you fix it, that is a repair and is not eligible for a tax deduction. However, if you decide to renovate the entire septic system, that is a capital home improvement and qualify for a tax deduction.
Below are the best tax-deductible home improvement projects.
Home office improvement
Are you planning a home addition so you can have a space for a home office? It makes sense since workplaces are changing environments thanks to Covid. Plus, according to USA Today, many people are looking to create a proper home office. And it is expensive to create one! The good news is the taxman might reward you for having a home office. But what’s the catch? Your home office should a place where you use 100% for work or work-related projects.
Remember, a home office eligible for a tax deduction if and only it is a separate room and not a corner in your kitchen or living room. So if you renovate your basement and transform it into an office, you can qualify.
Renovations to accommodate energy efficiency
Another best tax-deductible home improvement projects are renovations to improve energy efficiency in your home. Replacing your windows and doors with energy-efficient ones is a ticket for a tax write-off. Also, using solar panels to generate energy, installing solar-powered water heaters, and purchasing appliances that meet the energy efficiency requirement can earn you tax incentives.
Updating your home by insulating the attic, walls, and floors is another energy-efficient project that is tax-deductible.
Remodeling for medical care reasons
Remodeling a house for medical care reasons is a capital home improvement project, and according to IRS, it can qualify for a tax deduction. Such home improvement projects modify your home to adapt to a new use. For instance, if you add a room complete with medical equipment for your loved one, you can count that home remodel as tax-deductible. Also, renovating the bathroom to include support bars and installing smoke detectors and ramps is eligible for tax deductions.
Lawn and grounds updates
Updating anything outdoors that boosts the curb appeal will ultimately increase the value of your home during resale. And that means that such projects are the best tax-deductible home improvements. According to Internal Revenue Service, outdoor renovation projects that qualify for tax write-off include; landscaping, remodeling the driveways, installing a swimming pool, a fence, and a wall.
Are you looking to rebuild your home to protect yourself against a storm? Restoring your roof, installing stormproof doors and windows, or placing a new siding are exterior projects that also qualify for a tax deduction. Any external modification that improves the value and livability of your home can attract tax write-offs. And that means more cash to your pocket while creating a fancy and functional home.
A dumpster for tax deductible home improvement projects
Are you starting a renovation project? Contact us at Premier Waste Services for reliable remodeling dumpsters. We will help you take care of the renovation debris at an affordable rate.