Can I deduct my new roof on my taxes?

October 22, 2014 by Dave Du Val, EA
Roof on brick house

Hey Dave,

I had a new roof put on the house. Is it tax deductible?

Dana

 

Dana,

A new roof is generally considered to be an improvement to the structure. If the roof is on your primary residence − or on another home, such as a vacation home, that you use for personal purposes − then the cost of the roof is added to the cost basis in your home. Your cost basis is what you paid for the home, plus purchase costs such as appraisal fees, etc., plus other adjustments, such as improvements to the home. If this roof was put on a rental property home, you could start depreciating it in the year it was placed in service. More information on cost basis can be found here.

What this means is that there is not an immediate deduction for the entire cost of the roof. If it is on your personal home, it will result in less capital gain when you sell your home, which is a great reason to keep track of these expenses over the years prior to the sale. If it is a rental, or if you ever convert the home to a rental, the cost of the roof is recovered through depreciation.

Deductibly Yours,

Dave
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David E. Du Val, EA
Chief Compliance Officer for TRI Holdco

 

Dave Du Val, EA, is Chief Compliance Officer for TRI Holdco. Inc., the parent company of TaxAudit, and Centenal Tax Group. A nationally recognized speaker and educator, Dave is well known for his high energy and dynamic presentation style. He is a frequent and popular guest speaker for the California Society of Tax Consultants, the California Society of Enrolled Agents and the National Association of Tax Professionals. Dave frequently contributes tax tips and information to news publications, including US News and World Report, USA Today, and CPA Practice Advisor. Dave is an Enrolled Agent who has prepared thousands of returns during his career and has trained and mentored hundreds of tax professionals. He is a member of the National Association of Tax Professionals, the National Association of Enrolled Agents and the California Society of Enrolled Agents. Dave also holds a Master of Arts in Education and has been educating people since 1972. 


 

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