As a homeowner I was wondering. What kind of expenses for the home should I be tracking. We just had a new roof put on. We had a new furnace installed. Had some windows installed and insulation installed in the attic. Is there value in me keeping track of all of these expenses? I wasn’t sure if that when it comes time to selling the house with the records of these kinds of expenses be helpful in mitigating my tax liability from the sale to home.
If there is value in tracking this, what other kinds of things should I be tracking if any, when thinking of the future when the home may be sold?
You’ll be able to deduct improvements and no harm in tracking but once you get past 24 months to tap the capital gains exclusion it’s pretty unlikely for most that it will even come into play. For a couple that is married filing jointly capital gains exclusion shields $500k of gains on a property.
IIRC you can add the cost of those improvements to your cost basis when you sell, which could potentially lower your tax liability. The first $250k of profit (or $500k if married) is exempt from capital gains tax, but if you’ve made more than that at the time of the sale then adding the cost of improvements would raise your cost basis and lower the amount of excess that is taxable.
Yes, keep major improvement receipts for taxes when you sell your home. The realtors in our area also want documentation for what, how much and what year improvements were installed, and that goes right into the house listing description. I keep one copy for taxes, and one copy for warranties if something is covered and you need to later submit to heating/AC company or whomever. Here’s a link from Turbo tax that breaks it down as far as capital improvements vs. repairs: . https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&ved=2ahUKEwiP6Ymb3pb3AhU6DkQIHSiIBvwQFnoECAkQAQ&url=https%3A%2F%2Fturbotax.intuit.com%2Ftax-tips%2Fhome-ownership%2Fhome-improvements-and-your-taxes%2FL6IwHGrx6&usg=AOvVaw2HqQu6wx55umB8M3UXzaO0
– maintenance/repairs/replacements are not expenses for tracking home value basis to set a cost basis, its normal upkeep of property
As mentioned, you can add most things, but be somewhat careful… Like… If you replace the carpet now and then again in 10 years, the one you do now is no longer part of the basis because it’s been replaced.
Great article. If your business http://www.datatoleads.com is a great place to do We sell Consumer and business data to generate lower costing B2B and B2C Leads and Sales.turn data to leads! Would you be interested in getting sample custom targeted lead list at datatoleads.com .
Great Article. we all know Facebook.com ads suck and google.com adwords suck. Get your B2B Leads direct from http://www.datatoleads.com. Automate your calling your leads and watch your phone ring.