How Roof Repair Relates To Tax Deductions
Apr 28, 2019
Both homeowners and business owners alike can save significantly on their taxes by making the appropriate deductions for any roof repair or replacement work they’ve had done during the previous tax year.
Making the decision to replace your roofing may involve your homeowners insurance policy and your tax returns just as surely as a roof inspection and attention to the pressing needs of your roof.
Routine Roof Repair & Maintenance Deductions
When you are dealing with a relatively minor roof repair bill, you can simply keep the receipt and other pertinent documentation and write it off in full from your taxes at year’s end. The same goes for necessary roof inspections. Any repair to your roof (or home in general) that is needed to keep it functioning in an efficient, normal manner can be written off in this way. All routine repairs and maintenance fall under this broad umbrella category. In most cases, anything that cost $2,500 or less can be written off in full in a single year. Many businesses can deduct up to $5,000 in this way – and some even more. The rules were updated by the IRS in 2014 and made a little tighter and stricter, but the changes don’t negatively impact most homeowners.
When you are dealing with a relatively minor roof repair bill, you can simply keep the receipt and other pertinent documentation and write it off in full from your taxes at year’s end. The same goes for necessary roof inspections. Any repair to your roof (or home in general) that is needed to keep it functioning in an efficient, normal manner can be written off in this way. All routine repairs and maintenance fall under this broad umbrella category. In most cases, anything that cost $2,500 or less can be written off in full in a single year. Many businesses can deduct up to $5,000 in this way – and some even more. The rules were updated by the IRS in 2014 and made a little tighter and stricter, but the changes don’t negatively impact most homeowners.
Major Roof Repairs / Roof Replacement
If it’s just fixing a leak or anything in the small to medium cost range, it’s a one-year deduction. But, when it’s an update or repair that substantially prolongs the useful life of your property – technically called “betterments, restorations, and adaptations,” you may have to make the deduction over multiple tax years.
That is, you have to “capitalize” the expense (add it to the value of your home) and then deduct it according to the depreciation rate. For new roofing, you can claim depreciation across 27.5 years for residential buildings and across 39 years for commercial buildings.
In some cases, however, you will have a choice. If your roof repair or replacement was in the BRA (betterment, restoration, or adaptation) category and cost a substantial amount – but not too much, it could fall into a “limbo” zone where you get to choose what to do with it. In that case, you could take the deduction all at once or take the depreciation deduction across the allowable number of years.
Talk To Your Contractor About “Roof Taxes”
Maybe you’ve been thinking, “My taxes are going through the roof!” Well, why not use your roof to bring them back down a little?
Replacing your roofing is a major investment, but it’s a necessary one. Roof contractors are familiar with how Florida state tax codes relate to roof repairs and improvements. Don’t be afraid to ask about it.
To save the most money possible on both your roof job and on your taxes, you need to coordinate the whole project financially. The answer is never to neglect needful repairs, however, since that would lead to further damage and deterioration.
If you have a roofing need, feel free to contact Sheegog Contracting today. We serve all of Central Florida and can explain to you how roof needs and taxation issues intersect.
