Kitchen Remodeling As A Home Improvement Project

by | Jul 28, 2009 | 19, 2, Articles

<h2 style="margin: 10pt 0in 0pt"><font size="3" color="#990000">Kitchen Remodeling As A Home Improvement Project</font></h2><p><span style="font-size: 10pt; line-height: 200%; font-family: ‘Verdana’,’sans-serif’; letter-spacing: 1pt">People who are considering doing some home improvement will be interested to know that the money you spend in order to complete your project is eligible for tax deduction. It is very important to know exactly what you are doing in your home improvement process, however, as home improvement is different from home repair. In the case of the tax deduction, home improvement will qualify for the reduced rate, but home repair will not. It is imperative to know the difference between what constitutes repair and improvement.</span></p><p><span style="font-size: 10pt; line-height: 200%; font-family: ‘Verdana’,’sans-serif’; letter-spacing: 1pt"><div style="text-align: center"><object classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=6,0,29,0" width="425" height="282"><param name="movie" value="../images/banners/2b.swf" /><param name="quality" value="high" /><param name="menu" value="false" /><param name="wmode" value="" /><embed src="../images/banners/2b.swf" wmode="" quality="high" menu="false" pluginspage="http://www.macromedia.com/go/getflashplayer" type="application/x-shockwave-flash" width="425" height="282"></embed></object></div></span></p><span style="font-size: 10pt; line-height: 200%; font-family: ‘Verdana’,’sans-serif’; letter-spacing: 1pt"><p style="margin: 0in 0in 0pt" class="MsoNormal">Simply put, home improvement is an addition that will add to the appearance and the quality of your house. Items that fall under this category include things like kitchen remodeling, adding a fence to your yard, adding a swimming pool, extending a wing on your house and including a new room or two, building a garage, adding a porch or deck, installing new insulation, or upgrading heating and cooling systems. All of these upgrades are considered to be capital expenses.</p>  <p style="margin: 0in 0in 0pt" class="MsoNormal">Home repair, on the other hand, is in a different category. Home repair is a project that is undertaken in order to prevent the decay of your property. It does not add value to the house, instead it prevents the value from going down. This includes things like repairing holes in the walls or broken windows. These repairs correct a problem, and therefore are not considered eligible for tax benefits.</p>  <p style="margin: 0in 0in 0pt" class="MsoNormal">There is a way, however, that you can include your home repairs in your home improvement deduction. A clause in the act states that if an area of the house in need of repair is in the same area in which remodeling is taking place, the project undertaker is allowed to claim the entire project as an improvement. Basically, if you are remodeling the kitchen, remember to fix the leaks in the roof and then claim the repair as part of the improvement.</p>  <p style="margin: 0in 0in 0pt" class="MsoNormal">Timing is definitely a factor when it comes to home improvement. The best time to do some upgrades to your home will be when interest rates are low. The lower rates mean that in the long run, the person using a loan to finance their improvements will be able to spend less money. Refinancing is one way that many people secure the money to spend on their project. Loans secured in this way can be deducted in the same year as the refinance as points.</p><p style="margin: 0in 0in 0pt" class="MsoNormal"> </p><p style="margin: 0in 0in 0pt" class="MsoNormal">If the proceeds of the refinancing are not used to improve a house, then points towards the improvement can be deducted over the life of the loan. If a project only uses a part of the loan that was taken out, then the deduction is considered proportional, with the remainder being taken off over the life of the mortgage. It is important to keep in mind that the points which are not taken off by the time the loan expires are usually deductible according to the percent rate in the final year.</p><p style="margin: 0in 0in 0pt" class="MsoNormal"> </p><div style="text-align: center"><object classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=6,0,29,0" width="425" height="282"><param name="movie" value="../images/banners/2a.swf" /><param name="quality" value="high" /><param name="menu" value="false" /><param name="wmode" value="" /><embed src="../images/banners/2a.swf" wmode="" quality="high" menu="false" pluginspage="http://www.macromedia.com/go/getflashplayer" type="application/x-shockwave-flash" width="425" height="282"></embed></object></div>  <p style="margin: 0in 0in 0pt" class="MsoNormal">Improving your home, in the end, will always add value. It is important in terms of saving some extra money that the home owner is aware of what can be deducted and what cannot.</p>   <p style="margin: 0in 0in 0pt" class="MsoNormal">Article Source: http://www.articleset.com</p>  <p style="margin: 0in 0in 0pt" class="MsoNormal"><strong>About the Author</strong></p><p style="margin: 0in 0in 0pt" class="MsoNormal">Peter Mason publishes very often for <a href="http://www.laminating-guide.com/">http://www.laminating-guide.com</a> . Peter is working on topics like <a href="http://www.laminating-guide.com/laminating-equipment.html">http://www.laminating-guide.com/laminating-equipment.html</a>  and provides information on laminators. </p><p><span style="font-size: 10pt; line-height: 200%; font-family: ‘Verdana’,’sans-serif’; letter-spacing: 1pt">» Read more articles by <a href="http://www.articleset.com/articles-by_Peter-J-Mason_en.htm" target="_blank">Peter J. Mason</a></span></p></span>