Home staging lowers your realized profit.
As a seller in a competitive real estate market, you must offer buyers an attractive presentation of your home. You can hire a professional home stager to organize and simplify your home to make it aesthetically pleasing to potential buyers. A professional home stager's service is not tax deductible, but it does reduce the realized profit on the sale of your home, which can reduce potential capital gains taxes.
Hire a Professional
According to Internal Revenue Service guidelines, the cost of a home stager's services can be subtracted from the profit on the sale of your home. The IRS considers the service an expense as long as the home stager has been hired for the sole purpose of selling your home. A home stager's wages are part of the adjusted basis of your sold home. Home staging that you do yourself is not considered an eligible expense.
Advertising
Since a home stager prepares your house for potential homebuyers, the home stager's wages are considered an advertising cost. The IRS allows a seller to deduct advertising fees as a home-selling expense. These costs are subtracted from the proceeds of the sale and decrease the total realized profit. The expense is not itemized as a tax deduction on Schedule A of your federal tax return.
Negotiate Commission
Your real estate agent has an interest in selling your home because he receives a commission off the sale. If the agent sees the benefit of hiring a home stager, he might cover the stager's expense or reduce his commission. Neither of these options reflects a direct tax benefit, but they do reduce your out-of-pocket expense and lower the total profit from the sale.
Repairs Are Not Deductible
The IRS does not allow you to deduct expenses for repairs, upkeep or maintenance on your home, and these expenses cannot be subtracted from the profit on the sale of your home. Fresh paint, new carpet, furniture and home decorations are not tax deductible expenses even if a home stager recommends them.
Related posts
Before remodeling, estimate the cost versus value to make sure it's worth it.A lot more factors go into estimating the cost of remodeling your home than just materials and labor. On top of these,...
You can estimate the home-building cost per square foot.When assessing the overall cost to build a new home, it all comes down to the price you pay per square foot. Construc...
There are many different kinds of home siding. Each one has a different price for materials and installation. Before starting any home siding project, it is important to be aware of all costs that...
Factor in all costs and fees when calculating the cost of purchasing a home.Buying a home is a complicated process and many parties are involved. From the lender and title company to the real esta...
Selling a home in any kind of economy can be challenging, and if you find yourself in a hurry to sell your home you have added more pressure to the situation. When you need to price your home for...
