Different Home Improvements You Can Claim on Taxes

Home improvements, renovations, and repairs often cost a pretty penny, stacking up various fees and making dents in budgets. However, did you know you can claim some of that money back when you file your taxes? Certain home improvement projects qualify for credits under various tax laws. Here are four different home upgrades you can claim on your taxes.

Renewable Energy Sources

As an incentive to promote sustainability and environmentally friendly lifestyles, the government established a Residential Energy-Efficiency tax credit. This allows homeowners to claim various sustainable home improvements on their taxes, such as installing solar panels, solar heaters, residential wind turbines, or geothermal heat pumps. Homeowners can claim their renewable energy sources in their primary and secondary homes. In 2023, you can also qualify for a tax credit that matches up to 22 percent of the costs you spent on the renewable energy source, including the installation process.

HVAC Systems

There are multiple ways to claim an HVAC system on your taxes. Most tax regulations on heating and cooling units depend on the system you install. For example, mini splits qualify for federal tax credits in two forms: you can claim them for the Residential Energy-Efficiency tax credit and the federal HVAC tax credit. Both offer you a certain percentage match to the total costs you paid for the system.

Accessibility Upgrades

Many home improvements that make your home more accessible for people with disabilities, such as wheelchair ramps, qualify as medical expenses. You can claim these medical expenses on your taxes as a way to compensate for at-home medical care. In order to qualify, you or a household member must frequently need or require those upgrades. Other qualifiable medical expenses include railings, stairway modifications, door expansions, and the lowering of cabinets and kitchen structures.

Home Office Renovations

Designated at-home office spaces provide multiple uses. They create private work spaces, organize and store office supplies, and help many aspiring small businesses come to fruition. If you run a business from your home, you can claim certain home office improvements on your taxes. Office repairs also qualify for tax reductions. In order to qualify for the tax credit, your home office must be the designated hub of your business.

Taxes and home improvements come with many challenges, but they can offer fruitful deals when combined. Claiming different home improvements on your taxes allows you to get back some of the money you put into the projects. When filing, keep in mind that taxes come with various tedious requirements and tend to fluctuate yearly. Some tax credits even expire a couple of years after establishment.