Taxes can be overwhelming and confusing. In fact, there are a lot of misconceptions that need to be cleared up. For any confusion about tax, the best thing to do is to consult a certified public accountant. Before hiring a kitchen remodel service such as Reliable Remodeling, you should be familiar with the typical myths about remodeling and the home improvement tax.
1. Mortgage interest Deduction is Gone
According to Tom Wheelwright, certified public accountant and CEO of WealthAbility.com, if your home was purchased before Dec. 15, 2017, you can still deduct all of the interest on loans of up to $1 million under the old tax laws. However, for those who purchased a home after Dec. 15, 2017 or those who plan to buy in the future, mortgage interest is still deductible; the deductible amount is capped at $750,000.
2. All Home Renovations are Deductible
Home improvements, including painting services and HVAC upgrades, are generally not tax-deductible unless the property serves as a rental unit. Fortunately, there are exceptions to this rule. If the modifications are intended for medical purposes, like adding support bars or building ramps, then tax can be deducted. Another exception is when renovations are made because there is a plan to sell the home. The remodeling expenses can be marked as “selling costs” and will be deducted as long as the modifications were made within 90 days of closing.
3. You Can Deduct a “Home Office” if you Work From Home
A requirement of a home office deduction is that your area must be the primary site of your business. If you transform your spare room into your dedicated working space, it can be tax deductible. Those who just occasionally work at home cannot claim tax deductions. In addition, only self-employed individuals can deduct their home office in any way.
Reliable Remodeling is a full-service remodeling contractor. We offer complete home renovations, including interior and exterior services. Our team strives to deliver outstanding workmanship and creative design solutions in every project we handle. For your peace of mind, our company is fully licensed, and all our technicians are certified.
We have been serving clients in Pelham, AL, and the surrounding communities since 1992. Get your project started today! Call us at (205) 988-9194 to request a quote!