Is Your New Roof Tax-Deductible?

If you’re wondering whether you can get a tax deduction for installing a new roof on your Round Mountain, TX, home, this article will guide you through the specific conditions that will qualify you for tax savings. Continue reading as a residential roofing company shares more information below.

Does a New Residential Roof Qualify for Tax Deductions?

Generally speaking, the Internal Revenue Service (IRS) considers replacing a residential roof as a home improvement. Improving your home is not a tax-deductible expense.

When Can a New Roof Be Tax-Deductible?

You may be able to deduct the cost of a new roof from your taxes if it is a commercial roof or part of a profitable area in your property — for example, if the roof is for your home office or a rental unit.

Ways to Get a Tax Deduction for Your New Roof

There are ways to get a tax deduction or a tax credit for your roof replacement. Here are some of the accepted situations:

• Casualties – If part of your roof is damaged suddenly due to an unforeseen event, such as a storm, you may be able to deduct the cost of repairs when filing taxes that year.
• Depreciation – In the case of business use or rental properties, depreciation allows taxpayers to write off portions of their roofs over time based on their age and expected lifespan if they qualify as investments used in generating income during those years they’re depreciable.
• Home improvement tax credits – New home installations may qualify you for notable credits for energy-efficient model systems while bringing energy costs down over time. When you sell your home, these tax credits will save you money.

What Are Tax Credits?

Tax credits are incentives that permit you to subtract the amount of your credit from taxes due at the end of a year. A tax credit reduces the total amount paid in taxes by the amount you indicate on your tax return.

What Is a Home Improvement Tax Credit?

This type of credit is available when the total expense on an item or repair adds value to the residence and remains in place for some time, such as replacing windows. A contrast to this would be certain items such as paint that would be considered maintenance — not upgrades — and would therefore not be eligible.

How to Get a Home Improvement Tax Credit for a New Roof

The home improvement tax credit is only available for installed and qualified new systems, such as solar power. To get this credit, you must document the purchase of a qualifying item or system providing energy efficiency and submit your application and other related expenses paperwork. 

Does Roof Repair Count as a Home Improvement?

There is no tax deduction available for repair or maintenance of the home, as the IRS considers such expenses as normal expenses that cannot be claimed. Other examples of things that do not qualify include painting a room, maintaining a garden or fixing a dishwasher. 

Will a New Roof Help Me Sell My House?

Yes, having a new roof on your home can help increase its value when it comes time to sell. Since you will use the purchase of your house as an adjusted basis amount for taxes in the year you sell, installing a new roof can even increase this basis amount and lower taxes that would normally be due upon sale.

What Is an Adjusted Basis?

The adjusted basis of a home is the original purchase price increased by certain costs, such as improvements over time. When you sell a home, the adjusted basis will determine whether or not any capital gains are due on taxes from your profit in the sale. In addition to increases from improvement costs, other items that can raise your adjusted basis include closing fees and commissions paid while selling your house.

Other Ways to Save on Your Taxes

Though replacing a roof generally isn’t tax-deductible, there are other ways to save money on taxes when investing in a new roof installation. One of the best ways is to purchase energy-efficient products, such as solar panels, which generate electricity and are considered investments rather than normal repairs. Investing in one of these systems can also result in government grants or tax incentives as well as reduced environmental impact over time.

Other Benefits of Getting a New Roof

Though it won’t save money on taxes, there are other benefits to having a new roof installed. First and foremost, your home’s value significantly increases when you have a quality and well-installed roof, which can make selling much easier. Additionally, a new roof improves curb appeal, which will attract potential buyers to your property. 

Regarding energy costs, adding an excellent layer of protection at the top of your residence will help reduce your utility bills all year round, thanks to your new roof’s ability to reflect rather than absorb the sun’s heat. Through regular roof inspections and maintenance, your new roof will look great for years.

Only Trust a Professional Roofer!

Replacing a roof can benefit you in various ways, from having a better-looking house to improving energy efficiency. When investing in home improvement, knowing the options available and considering how they will affect your long-term expenses is good practice. At STARR Roofing & Gutters in Round Mountain, TX, we are here to help with your roof replacement, metal roofing needs and more. Contact us at (512) 736-6539 and let our experts guide you through all your roofing options.