Posts Tagged ‘energy’
Tax Deductible Renovations
April 6th, 2009
Question: Tax Question: Renovations Made To My Yard For Day Care…Is it Tax Deductible?
Here is the break down:
Yard Renovations for Day Care:
$2587.50-Labor
$972.00-Top Soil
$324.00-Grass
$564.73-Playground
$152.81-Playground 2
$349.73-Sand/Fill
_______________
$4,950.77
We had to have a yard big enough to accommodate enough space for 8 children and have something for them to do while outside as outdoor activity is mandatory everyday. The yard also has to be free of hazards like holes, which we had a lot of! We had a small rough yard with no structured activity for the children so we had to fill in the yard, get top soil, grass and build a playground. Does this qualify as a tax deduction?
Answer: Playgrounds, labor, sand for play qualify but the grass & topsoil debatable. They are not going to be a typical Sch C expense. You need to use 4562 for depreciation. These are capital expenses you expect to last greater than 1 year. Landscaping is 15 year recovery period in depreciation. The playgrounds would be 7 year property.
Call the IRS and ask about the details on the landscaping before you deduct 1 800 829 1040
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Are you ready for home ownership?
Purchasing a first home is an exciting time in anyone’s life. It’s also a large financial undertaking, a fact that leaves many people wondering whether they’re prepared for this big step.
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Home Improvements Tax Deductible
October 22nd, 2008
Question: Are home improvement costs tax-deductible?
Answer: Tax-favored home improvements range from replacing windows and doors, to adding insulation or special roofing material, to converting heating and cooling systems to solar power.
The best thing about these tax breaks is that they are credits, which reduce IRS bills dollar for dollar. And while some credits are phased out once a taxpayer earns a certain amount, these credits are available to any homeowner, regardless of income.
You can include as medical expenses amounts you pay for special equipment installed in a home or for home improvements when the main purpose is medical care for you or your spouse. You can then deduct these amounts as long as you follow your doctor’s orders and the IRS’s rules. When claiming medical deductions, both the medically necessary home improvements as well as the more run-of-the-mill health care costs must be itemized on Schedule A. And only the amount that exceeds 7.5 percent of your adjusted gross income is deductible.
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Deductible Home Improvements
October 16th, 2008
Question: Home improvements tax deductible?
I just put a new roof and new vinyl siding on my rental property. Is this tax deductible if I paid cash for it?
Answer: On residential rental property you capitalize these improvements and depreciate them over 27.5 years. Rental property (reported on Sch. E) doesn’t qualify for Sec. 179 election to expense.
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Energy Efficiency Tax Deductions
April 19th, 2008
Question: Is an artifical lawn a tax deductible expense?
We live in the desert in AZ & for energy efficiency & due to the extreme heat in the summer, we installed a small artifical lawn instead of real grass. Even though it’s fairly small, it was a big expense. It should pay for itself in the long run, by saving in watering expenses & not having to buy a mower & other lawn maintenance expenses. Does this qualify as a energy-efficient home improvement tax deduction or any other type of tax deduction? I cannot find any information on this online. Thanks.
Answer: Good question. I am pretty sure energy efficient mean improvements that either produce or use less electricty. I do not believe you can deduct the cost of the lawn.
Home improvements are added to your basis in the property and then reduce the gain on the sale when you sell the home.
You might try www.irs.gov to see if you can find the answer. You can call the IRS at (800) 829-1040. (Long wait on hold this time of year) Or, you can write to the IRS and ask your question. Writing is what I would do.
If you have not received an answer by the time you file your return. File with out deducting the lawn. If the IRS writes back and says you can deduct the lawn then file Form 1040X.
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Tax experts weigh in on filing tips
The end of 2009 and the holiday season marks the beginning of another, often less joyous, time of year — tax season. In order to make the 2010 tax season a little less stressful, various tax experts have weighed in on ways to better prepare for the filing season.
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