Oh Joy, our government loves my money. Hopefully this year I do not owe (still PO'D about that)
I am doing my own taxes this year to save money and have questions.
1. We had a bad storm last year and I had to replace the entire roof. I was not able to claim this on my insurance (due to the age of the roof.) My question is can I claim this on my taxes? It is my understanding that I cannot claim a casualty loss, but maybe a Energy saving credit? I spent $4,200.00 out of pocket and I do not have a energy saving certificate from the manufacturer...
2. Last year I owed Federal, State, and Local taxes, can I claim these this year?
Thank You in advance!
1 - Not a deduction.
2 - Your payments on taxes owed is not deductible on your tax form.
To avoid being in arrears in the future, you need to do proper tax planning.
Start here if you have an employer:
http://www.irs.gov/Individuals/IRS-Withholding-Calculator
Or here if you're self-employed:
http://www.irs.gov/pub/irs-pdf/p505.pdf
1. Casualty losses can be claimed in some cases. Since you state you cannot claim it, I'm assuming you've already done the research. If not, see the instructions for completing a Form 4684. I'm not aware of any type of energy saving credit.
2. State and Local taxes are deductable on your federal return. See the Schedule A instructions. "State and local income taxes paid
in 2012 for a prior year, such as taxes paid with your 2011 state or local incometax return. Do not include penaltiesor interest."
I use Turbo Tax. It is inexpensive (@ $50) and it steps you through the various quesitons. I do not think you can write off your roof. The exception would've been if you had taken a Home Equity loan, then you can write off the interest of that loan.
I found this on irs.gov
Table 3. Adjusted Basis
This table lists examples of some items that generally will increase or decrease your basis in your home. It is not intended to be all-inclusive.
Increases to Basis Decreases to Basis
Improvements:
Putting an addition on your home
Replacing an entire roof
Paving your driveway
Installing central air conditioning
Rewiring your home
Assessments for local improvements
(see Assessments for local benefits, under What You Can and Cannot Deduct)
Amounts spent to restore damaged property
Insurance or other reimbursement for casualty losses
Deductible casualty loss not covered by insurance
Payments received for easement or right-of-way granted
Depreciation allowed or allowable if home is used for business or rental purposes
Value of subsidy for energy conservation measure excluded from income
Improvements. An improvement materially adds to the value of your home, considerably prolongs its useful life, or adapts it to new uses. You must add the cost of any improvements to the basis of your home. You cannot deduct these costs.
Improvements include putting a recreation room in your unfinished basement, adding another bathroom or bedroom, putting up a fence, putting in new plumbing or wiring, installing a new roof, and paving your driveway.
Amount added to basis. The amount you add to your basis for improvements is your actual cost. This includes all costs for material and labor, except your own labor, and all expenses related to the improvement. For example, if you had your lot surveyed to put up a fence, the cost of the survey is a part of the cost of the fence.
You also must add to your basis state and local assessments for improvements such as streets and sidewalks if they increase the value of the property. These assessments are discussed earlier under Real Estate Taxes .
Repairs versus improvements. A repair keeps your home in an ordinary, efficient operating condition. It does not add to the value of your home or prolong its life. Repairs include repainting your home inside or outside, fixing your gutters or floors, fixing leaks or plastering, and replacing broken window panes. You cannot deduct repair costs and generally cannot add them to the basis of your home.
However, repairs that are done as part of an extensive remodeling or restoration of your home are considered improvements. You add them to the basis of your home.
Records to keep. You can use Table 4 (at the end of the publication) as a guide to help you keep track of improvements to your home. Also see Keeping Records , later.
What the heck! I am an accountant and I can't even understand your logic.
Just being energy star means nothing, it must be one of the products listed in the law and then it is subject to limits and ceilings. It reduces your taxable income.
An example would be I replaced all my windows for 6,500 that yielded me a whooping 500 dollar reduction in my taxable income.
We replaced our roof last year and there was no mention of tax savings so I don't think it made the list.
I have no idea what you are talking about with the taxes being tax free.
I prepare taxes for a living, and though I will not go out on a limb to answer these questions as I don't have all the situation, I just wanted to urge your desire to save a few dollars by trying to tackle this yourself. You can have a qualified tax preparer - even a CPA - prepare your return for a lot less than you'd think. At my small firm we generally charge 1/2 of what an H&R Block charges - and you will get a CPA doing your return. For a simple 1040 with a W-2 and some deductions we are hard pressed to charge over a hundred bucks.
The reason I took the time to write this is based upon my experience of what it costs to fix things when they are done incorrectly. Once the IRS gets involved, that $100 you saved will look like a bargain. An amended return, tax representation, penalites, and fines will dwarf the original fee. And in your case, even if the roof isn't deductible, they may help you find another credit you are elgible for which will save you money.
Good luck!
