Guest Blogger: Essential Tax Deductions for your Home Renovations

 Guest Blogger #655, Entry #1564, September 6, 2012

When it comes to filing your annual (or quarterly) taxes, pretty much any kind of legitimate deduction that you can make is one that you’re after. So, did you know that there are several home renovations that qualify on the “tax deduction list”?

Can you claim energy efficient tax breaks for your home?

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Although we recommend that you go to IRS.gov to get a full listing so that you can see firsthand which ones you qualify for and which ones you don’t (because with some, there tends to be some “fine print” that applies), we have enclosed five that are pretty clear-cut and easy to understand:

Energy-efficient changes qualify.

It would seem like the entire universe, including Uncle Sam, is in support of “going green”. If you have recently installed energy-efficient windows, doors or sky lights, or if you have added insulation or solar panels, you can get as much as 10 percent off of the total that you paid to make these renovations to your home (minus the installation fees).

Medical additions qualify.

If you needed to make some additions to your home that was medically necessary, you are able to write-off some of those costs as well. The cost of installing things like exit ramps, widening doors, lowering cabinets and making bathrooms wheelchair accessible are all eligible so long as you can prove that there was a true medical purpose for them. However, any aesthetic changes that were made during those renovations cannot be put onto the deduction list.

Home office renovations qualify.

Many people who work from home already know that they can deduct their office space (along with a large amount of their utilities and supplies that are work-related) on their taxes. However, what a lot of individuals may not know is that you can also deduct a percentage of what it costs to renovate that space too. This includes any of the remodeling expenses that you incurred that are directly associated with your home office.

Your home office could help you on your taxes

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Getting a metal roof will qualify.

Did you know that if you replaced your shingle or tile roofing with a metal roof that it will also give you a bit of a tax break? A metal roof is durable, it’s energy-efficient, it requires little maintenance and lasts for years to come. Sure, it may cost quite a bit to add it to your home initially, but it’s definitely a worthwhile investment in many ways (including on your tax bill) on the back end of the purchase.

What adds value to your home will qualify.

If you are redoing some electrical wiring or plumbing; if you are landscaping or adding a room; if you are putting in granite countertops or new appliances, these are all things that can ultimately help to add long-term value to your place. And, if you hold on to all of your receipts, these are also things that you can deduct on your taxes as well. Of course, in order to find out what other things qualify for a “home renovation tax deduction”, you may want to contact one of your local CPA services or speak directly with a personal tax accountant. However, there’s also detailed information listed on IRS.gov. Simply go to the website and put “Home Improvement Deductions” in the search field.

For more home renovation ideas on Stagetecture, click here.