Home improvement refers to a wide range of renovations and remodeling projects designed to increase the efficiency or enhance the appearance of a home. Home improvements can also be made to address safety issues or to meet changing lifestyle needs. Many projects are relatively inexpensive and can be done by an amateur, but some require the skills of a professional or may require permits.
A home improvement project may be tax-deductible if it’s considered a capital improvement, according to New York state law. To qualify, the project must be documented as such by filing with the department of taxation and finance. Labor costs are typically not tax-deductible. However, you should always consult your CPA to determine what’s best for your situation.
Before undertaking a home improvement project, assess your budget to make sure that the renovations are within your price range. Reyes recommends checking your emergency fund to see if there’s enough money set aside to pay for the work, as well as evaluating whether you could afford a one-time or recurring payment plan. If you don’t have sufficient cash saved, consider a secured loan that doesn’t require collateral and offers favorable terms.
Be aware that some improvements can detract from value rather than add it, particularly those that are too personalized or out of step with the style of your neighborhood. Likewise, neglecting basic maintenance tasks can cause damage that’s costly to repair or even to replace. For example, a leaking roof can result in water and mold damage.