How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Robin D. Your Own Question
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13327
Experience:  15years with H & R Block. Divisional leader, Instructor
14155347
Type Your Tax Question Here...
Robin D. is online now
A new question is answered every 9 seconds

I had a house built in Phily Construction started in the

Customer Question

I had a house built in Phily Construction started in the fall 2014 and finished in spring 2015 I sold house at end of July 2015 Is every bill that went into that house construction tax deductible
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.

Hello,

The amounts you spent to construct the house would be added together with the cost to form your basis.

These costs are called the basis of the property and can be deducted when the home is sold. The costs that must be included in the basis of the home are:

  • Land
  • Materials
  • Labor (paid but not your own)

The costs to build are all added for the basis and this would reduce the gain.

The amount it cost you to complete the house, including:

1. The cost of labor and materials, 2. Any amounts paid to a contractor, 3. Any architect's fees,

4. Building permit charges, 5. Utility meter and connection charges, 6. Legal fees directly connected with building the house

Please advise if you need more information or rate positively.

Customer: replied 1 year ago.
What's about taxes and design fees and permits costs plus utility bills during the construction
Expert:  Robin D. replied 1 year ago.

Some of those costs are allowed.

The design fees and permit costs.

The utility bills would be but only for business.If this was a home specifically built to sell then yes, those costs are included.

Taxes are allowed but it depends which taxes. If real estate taxes they are claimed on Schedule A or the if business on the business return.

Customer: replied 1 year ago.
it does not matter if some of the bill are in 2014 and others in 2015
Expert:  Robin D. replied 1 year ago.

That is correct , the costs are added to basis when sold. This is true even if over 2 years

Expert:  Robin D. replied 1 year ago.

I hope that was helpful

My goal is to give you excellent service.
Your positive rating is thanks enough

Rating lets Just Answer know you were assisted and credits me for the time.