Calculators and tax forms

Taxable Deductions for Home Modifications- Deductible Home Improvements

home modification info

If you are living with a disability, at some point, you need to make specific home modifications to foster your independence. And as we all know, most of these home modifications can cost quite a fortune.

Fortunately, you can recoup most if not all the costs you incur in adding special equipment and making home modifications for accessibility. But how can you do that? Well, the government offers tax incentives and deductions for individuals who need accessible home improvements.

That said, this article will discuss the most common taxable deductions for home modifications. Without further ado, let's dive in!  


What are Tax Credits, Exclusions, and Deductions?

If you'd like to file your own taxes, there are specific standard terms you should familiarize yourself with. That helps better understand tax liabilities and make more informed decisions with your money. For that reason, this section will discuss tax credits, exclusions, and deductions.

  • Tax credits. These are discounts you get on what you owe the government. You can get tax credits for is you are legally declared disabled.

  • Tax exclusions. These are items you can leave off your tax form. For instance, if you receive some form of compensation money for physical injuries.

  • Taxable deductions. Deductions generally lower the amount of money you need to pay in taxes. Deductions are calculated by subtracting every allowable deduction from your total income. For instance, if you modify the hallway in your home to accommodate a family member who needs to use a wheelchair, you can subtract the amount used to make the modification. You can also deduct any other cost required in making home modifications that will improve the quality of your life living with a disability.

Accessible Home Improvement Requirements

Before you start making any improvements to your home, you need to be aware of the requirements put forth by IRS for home modifications and improvements. To begin with, the changes must be related to your disability. You can install a stair lift if you have limited mobility and need assistance moving around your home.

Expenses incurred in installing the stair lift will be deducted from your tax liability. But if you paint the walls of your stairwell to match your stair lift, that won't be counted in the taxable deductions for home modifications. In short, any home improvements you make for aesthetics or personal reasons are not included in the deductions.

Remember, the IRS checks to see if the home improvements or modifications are a crucial part of your treatment. That includes modifications that will improve your mobility and the general function around your home.

Deductible Home Improvements for Accessibility

When it comes to home improvement deductions, there's never a one-size-fits-all. Each person needs specific improvements to help them enjoy their life. Besides, new home improvement ideas are coming up all the time. All in all, the IRS has a list of the common home modifications that are deductible in your tax liability.

All the same, the IRS always considers these modifications on an individual basis. That means certain home modifications that are not on the list could also be deductible. However, you'll have to work with your doctor to prove that the modifications are related to your disability.

For individuals who need wheelchairs, there's a wide range of approved taxable deductions for home improvements. Mostly these are necessary home modifications that help you fully utilize your home even when living with a disability. That includes:

  • Lowering countertops and kitchen cabinets

  • Widening the doorways and hallways for accessibility

  • Installation of wheelchair ramps

  • Adding grab bars in the bathroom

  • Installation of shower chairs

  • Modifying the stairways and installing stairlifts

  • Installation of non-skid treads

  • Modifying and raising the toilet seats

  • Personal Emergency Systems

  • Replacement of electrical outlets and light fixtures

  • Installation of security systems and doorknobs

These modifications offer extra support around your home and improve the quality of your living. They are deducted from your tax liability because they don't necessarily increase your home's resale value but cater to specific medical conditions.   


In Summary

Now that you know the taxable deductions for home modifications prepare well before filling the taxes. Gather all manuals, receipts, and doctor notes that prove the home modifications you've made are related to your disability.

Ensure you have the evidence you need to show your medical needs required you to make these modifications. On top of that, get professional help from someone who understands home modifications and tax deductions for people with disabilities.

Subscribe to be updated on the accessibility modifications app launch and to receive our newsletter