Title: Deducting Improvements vs. Repairs on Your Taxes
Headings: Deducting Improvements vs. Repairs on Your Taxes
Deducting Improvements vs. Repairs on Your Taxes
Definitions and Differences
Definition of a Capital Improvement
Examples of Improvements:
Definition of a Repair
Examples of Repairs:
How to Deduct Improvements on Your Taxes
Example of How to Deduct an Improvement
How to Deduct Repairs on Your Taxes
Example of How to Deduct a Repair
Improvements vs. Repairs, Which Is Better?

Content: Definition of a Capital Improvement
A capital improvement is a property update that will extend the “useful life” of the property. The thinking here is that it is not just a short-term fix, rather it is something that will add value to the property for years to come. Improvements are usually more extensive than repairs and usually involve greater cost. Improvements include: Adding something that was not previously there
Upgrading something that was existing or
Adapting the asset to a new use
Examples of Improvements: Adding an Addition
Adding Central Air Conditioning
Installing a Security System
Installing Brand New Hardwood Flooring
Replacing an Entire Roof
Replacing All Existing Plumbing
Replacing All Existing Electric
Renovating a Kitchen
Renovating a Bathroom
Replacing All Windows
Adding a Deck
Building an In-ground Pool
Definition of a Repair
A repair is necessary maintenance to keep the property in habitable and working condition. The IRS defines repairs as those that “do not add significant value to the property or extend its life.” When something is repaired, it is generally restored to its previous good condition, not improved upon. Repairs can usually be completed for a reasonable amount of money. Replacements of broken appliances are usually also considered as repairs.