Tax season is now upon us, and certain home improvement projects might qualify for tax credits. AnyWeather Roofing, your local roofing contractor, discusses what you need to know about capital improvements.
What Are Capital Improvements?
A capital improvement involves an update or improvement to one or more areas of the property with the objective of adding value and extending its utility instead of fixing a short-term problem. It is more than a repair job and often comes with greater costs.
Tax deductions are possible if you have a home improvement loan that is for your primary residence and that the loan amount is used to improve your home in a substantial manner.
Home Repairs and Routine Maintenance: Do They Count?
An emergency roof repair and routine maintenance checks on your roof do not count as capital improvement. Therefore, they won’t be deducted from the interest of your loan. A roof replacement, however, is deemed a capital improvement and is subject to tax deductions since it improves your property, especially if it is in need of protection against the elements and better energy efficiency.
Note, however, that a home repair becomes tax deductible if you decide to put your home up for sale. Such an improvement is added to the tax basis of your property, referring to the amount you invested in it for tax purposes. Certain exemptions are available for the expenses to make repairs and maintenance count towards the deductible, but it takes the help of a knowledgeable tax advisor to make it happen.
For your home exterior improvement needs, turn to a reputable residential roofing contractor like AnyWeather Roofing. Our exterior home improvement services also include siding and gutters installations. Call (859) 286-6400, or fill out our contact form to request a free estimate.