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Can You Get Tax Deductions for Home Renovations or Improvements?

At Ascent Builders and Basement Partners, we get this question fairly often, especially at the year draws to a close and homeowners are looking to maximize their tax return. Although you can’t use home renovations as a straight deduction, there are a few ways to minimize your taxes with home renovations or improvements.

Use Your Mortgage to Make Home Improvements: One way to save on home improvements is to use some of your mortgage when you first purchase your home. Then you can deduct the mortgage interest at the end of the year, saving you on your taxes.
Improvements that Qualify as a Medical Expense: For example, if you need to make your home handicap accessible for a family member, these expenses can qualify as a medical expense. Just keep in mind that if the improvements increase the value of your home, they can’t be claimed as a medical expense.
Energy Tax Credits: One of the most generous credits available are for installing qualifying energy generation systems such as geothermal heat pumps, solar water heaters or solar panels. You can receive up to 30% of the total cost of the project, including materials and installation.
Home Improvement Deduction for a Home Office: If you are self-employed or currently take advantage of a home office deduction, you can also deduct certain home improvements.