I bought my first home in April 2008. It was an older home that needed lots of repairs. I’ve spent over $8,000 out of pocket for some of the repairs (some improvements, but mostly necessary repairs). I have kept all receipts. I was wondering if there was a way that I could use this deduction in my 2008 taxes. How do I go about doing this? Where do I put this information?
Thanks for your help!
Asked by:companyb6
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you don’t unless you are renting out the house for profit.
Capital expenditures go into the cost basis of the house therefore reducing your gain when you sell the house. that is your tax benefit
No deduction for home repairs. No deduction for home improvements.
However, home improvements can be added to the cost basis of the house when you sell it. For example, if you paid $100,000 for the house, and if you incurred $10,000 of improvements, then your cost basis is $110,000.
If you sell the house for $500,000, then the gain on sale is $390,000 – not $400,000.
Repairs are just that repairs. You cannot use them for anything.
Can’t.
Nope.
Only of use if rental property, not for your home.
When you sell, these improvements (not repairs, but improvements) add to basis in your home, but the exemption on tax on sale of your home, if applicable, wipes this out too. But if it isn’t, then it helps by reducing your capital gain on sale of home.
You did apply for the first time home buyers credit of $7,500 on your tax return, didn’t you? Put that money onto the principal or partly on principal and partly onto the repairs.
You don’t put it anywhere on your return. It’s not deductible.