Is a New Roof Tax Deductible?
When replacing your roof, you want to find savings anywhere you can. You may ask yourself, “Is a new roof tax deductible?”
The answer is: maybe. Depending on your situation and what kind of roof you’re replacing, you may be able to deduct the cost from your taxes.
Our team at Majestic Exteriors, Colts Neck’s roofing experts, has everything you need to know about roofing tax deductions.
When Can I Deduct a New Roof?
The only situation where you can deduct the cost of a new roof no-questions-asked is when you’re replacing a commercial or rental property roof.
Luckily, homeowners can use a few other avenues to deduct roofing costs from their annual tax returns. Let’s take a look at each of these scenarios.
Casualties
Casualties are unforeseen events that damage your home. Some examples of casualties include storm damage, fire damage, and some types of impact damage.
If your roof sustains casualties, you may qualify for tax deductions. You may also qualify for federal home repair grants that reduce the cost of replacing a damaged roof. Keep in mind that if your insurance company reimburses you for repairs, you are not eligible for deductions related to those repairs.
Home-Improvement Tax Credits
The IRS generally reserves home-improvement tax credits for energy-efficient home improvements. Currently, you can claim up to 26% of these costs through the Residential Renewable Energy Tax Credit. Some scenarios where energy-efficient home improvement tax credits become available for your primary residence include:
- If you use ENERGY-STAR-approved materials
- If you install a reflective roof
- If you add solar panels to your roof
Depreciation
Is a new roof tax deductible for a rental property?
If you use your house as a rental property, you can write off the cost of your roof as depreciation over the course of two to three years. There are situations where the IRS permits longer depreciation windows, but the two-year to the three-year window is standard.
In fact, this rule extends to any capital improvement you make to your home. When a home with capital improvements changes hands, the owner can deduct capital improvements from the taxable sale price. So, from a long-term perspective, you get tax benefits from replacing your roof, but you still have to pay upfront.
Professional Roofing Services
If you are still wondering, “Is a new roof tax deductible?” call us at (848) 863-6775. At Majestic Exteriors, we know the ins and outs of all different types of roofs, and we can help you understand how to reduce your roofing costs.