Home Improvement Deductions

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It used to be that money you spent on home improvements was considered as home investments and they would reduce capital gains when it came to selling the home. The determination of capital gains is the difference in price from what you paid for it to what it sold for minus the cost of the home improvements.

Laws have changed however, in 1997 for most homeowners, the capital gains tax was pretty much eliminated. The exemptions are $250,000 for single homeowners and $500,000 for married homeowners.

Still, it is extremely important to keep all records of any home improvements you have made. Things such as energy efficient windows, appliances and other things may get you a deduction.