The approach of spring often encourages homeowners to start considering home improvements and repairs. However, before you start getting out the hammer and nails or hiring a contractor consider if your home improvements may be eligible for a home improvement tax deduction.
The first thing the homeowner must understand is the difference between a home improvement and a home repair. Simply put, a home repair is classified as fixing a problem. For example, repairing a hole in the roof, fixing a leak or repainting a room would be considered repairs. On the other hand, remodeling a kitchen, adding a couple of rooms, building a garage or installing a swimming pool would be classed as improvements. These improvements add to the living amenity of the home’s owners and usually add value to the home.
The Internal Revenue Service sets out strict guidelines on how a homeowner can claim a tax deduction for home improvements. It is strongly recommended that before you hire a contractor or start any home improvement works that you obtain advice from you tax consultant or from the local office of the IRS
Tax deductions can fall into any of several different categories. A medical condition that required providing disabled access to home would normally be classed as a home improvement.
There is a special tax deduction for victims of Hurricane Katrina. Consult with the IRS regarding the Katrina Emergency Tax Relief Act as it increases the permitted qualifying home improvement loans.
If you are planning improvements to an area of your home that is in need of repair you may be able to include the repair as an improvement. The Tax Act states that where a repair is carried out in the same area of the home that is being remodeled then the repair can be included as part of the remodeling project. So, if you are planning on remodeling your kitchen don’t forget to take care of the leaking pipes at the same time and claim the entire project as a deduction.
Tax Credits vs Tax Deduction
Tax credits can also provide significant savings to the homeowner. Whilst a tax deduction for home improvements can reduce the amount of income on which tax is payable, a tax credit directly reduces the tax itself. Tax credits are available for many types of home improvements. For example, installing insulation, adding energy-efficient windows, and some types of highly efficient equipment for cooling and heating, and solar water heating may all qualify for tax credits.
By: Alison Stevens
Posts Tagged ‘Remodeling Project’
Claiming a Home Improvement Tax Deduction
March 27th, 2010Home Improvement – 5 Tips to Find a Contractor
March 24th, 2010
Here are 5 tips to help you find a good contractor to do your Home improvement project. Requirements such as experience, being flexible, and meeting time requirements and other conditions are outlined below.
1. When choosing a local contractor or home remodeling expert make sure they are licensed and insured and can meet city ordinances. An example would be getting a San Antonio home improvement contractor who is licensed in the San Antonio area. This will Eliminate problems that could arise with your project, and also following city requirements will save you time and money.
2. Be sure to ask the contractor for references about past remodeling projects that were similar to yours. This will give you a great idea on how good of remodeling work or construction work they do.
3. Asking your contractor about the details of how he will complete your project will help eliminate issues that may come up later. You and the contractor may come up with a better way to complete your home remodeling project by properly communicating.
4. Be sure and ask about a guarantee for all work. Knowing what type of guarantee your contractor gives on his work is important. If you can’t get a guarantee in writing go find a better contractor in your area.
5. It’s better to choose a contractor who has an interest in earning and keeping his reputation. A contractor who runs his own business will be willing to go the extra mile and give you advice on smaller home projects as well.
Now you’re ready to get the best contractor for your Home Improvement project. Be sure you get an insured and licensed contractor and ask for details for the project in writing. Good luck to you and your homes new look.
By: Ron Gilmore
Home Improvement – What Adds the Most Value to Your House
March 6th, 2010
Real estate is an exciting and extremely challenging industry despite the economic and financial turmoil that directly affect this sector. There are definitely countless possibilities and ventures that offer profitability and productive measures as long as you know how to do it right. Selling a house is a promising investment although there are possible hindrances in its productivity since the massive impact of the ailing economy decreased the number of potentially sure home buyers in the market. Furthermore, the increasing growth of the overflowing competition makes it more difficult to succeed in home selling. To remedy this dilemma, it is important to consider home improvement as a viable tool to maximize.
Upgrading your house to boost its market value and thus increase your chances of selling your house in a jiffy is simply an asset in this milieu. You need to basically make a careful and thorough research on the fundamental home renovation ideas and techniques since not all parts of the house are created equal. For instance, there are rooms or areas in the house which are more viable and profitable when addressed accordingly. Hence, know what adds the most value to your property and put your utmost attention and resources into it.
It is imperative that you know what must be included and placed on top of your priority list for your home remodeling project. Prior to touching anything in the house for updates, make sure that you have a clear plan ahead, envisioning what you deem necessary and helpful in boosting the worth of your house. If you do not have initial plans, you certainly risk costly losses due to unpredicted mistakes and discoveries while in the middle of your renovation process.
There are two salient parts of the house which are primarily considered focal points in terms of its selling potentials. These are the first areas where potential home buyers basically look into and great influence their decisions whether or not to buy your house. The kitchen is one of the most important areas of the house since it is the most frequented and used. Most family functions, gatherings and even day to day conversations and activities are commonly shared in the kitchen or dining area. Furthermore, this is where you prepare the food that nourishes your body for your everyday function. Thus you basically need to make sure that the place is truly a venue for your wellness and overall quality of living.
Start your home enhancement by checking repair and fixture issues in your kitchen such as the plumbing, drainage and electrical systems facilitating your daily kitchen activities. Make sure that you promptly and accordingly addressed these issues since it gravely affects the property’s worth in the market. You may also need to consider the flooring, walls, faucets, dishwashing and built-in appliances if they are properly functioning or not. The same process of upgrading is equally important in your bathroom through checking the components for some defects that needed fixtures.
Adding value to your home is of utmost importance if your ultimate goal is towards profitability and a productive venture in real estate.
By: Marikor Hidalgo
