June 11th, 2014
In case you missed it, here’s our first posting on simple home improvement tips: Home Improvement With A Pocketful Of Tips
Today we’ll look at even more good bits of advice, whether you’ve just bought your first house, your fifth house, you’ve lived at the same place for over ten years, and everyone all in between.
It’s exciting to have your new home. If you just bought a new-to-you home, chances are, you’re a bit cash poor. Now is not the time to whip out the credit card and overspend on new furniture and home improvements. Everyone wants to personalize a new home and upgrade what may have been temporary apartment furniture for something nicer, but don’t go on a massive spending spree to improve everything all at once. Even if this isn’t your first home, it’s wise to spend a little time in the house getting used to the feel and flow. Then write down all of your ideas and prioritize the improvements.
First time homeowners also have to get used to looking in the mirror when something goes wrong. Before, you could call up the property management company or the main office if you had a leak or clogged toilet. Take some time to learn how to unclog a drain versus unclogging a sink. Learn the best way to unclog a toilet.
Everyone should remember to keep all your receipts for home improvement. When you sell your home, you can use these costs to increase your home’s basis, which can help you to maximize your tax-free earnings on the sale of your home.
It’s important to remember the difference between an improvement and a repair. If you purchased a foreclosed home that had a lot of broken pipes or holes in the wall, those are considered repairs by the IRS and not home improvements even though it did improve the house. It didn’t increase the cost basis of the house. Upgrading windows and doors, adding in air conditioning, and replacing the roof are all considered home improvements. That being said, if you had to open up a wall to replace plumbing or electrical wiring, you may be able to consider that an improvement. Talk to a professional tax adviser to find out. And, again, keep all receipts with documentation.