Good news, IRS rules and guidelines now allow luxury home staging investments to be qualified as tax deductible.
We just stumbled upon this very insightful article on the topic of home staging expenses and tax deduction. In addition to the obvious benefits of home staging, better online impressions and making it easier for prospects to visualize all of the home’s possibilities, the staging costs are tax deductible.
Read the full story here, along with some excellent CPA insight. http://www.recordonline.com/news/20170219/claudias-corner-costs-of-home-staging-can-be-tax-deductible
To recap:
Staging costs for primary and secondary homes under this rule are considered to be selling and advertising expenses.
This means when you engage a professional stager for staging services and furniture rentals, these costs reduce the profit of the transaction and you can have less tax liability.
Like any IRS rule, there are fine print details and conditions to be aware of to fully benefit from the deductions.
Tax deductible DO’s:
- Keep good records of any fees and expenses paid to a professional home stager
- This includes fees to prepare your home for buyers
- This includes photography of your staged home
Anything that appears to be an improvement that the current homeowners enjoy or take with them are NOT tax deductible expenses:
- Cleaning costs
- Painting costs
- Repair costs
- Home improvement costs
- Home staging expenses if the listing is taken off the market
From a home stager’s perspective, we see time and time again that home staging investments make a big difference in the speed of the listing’s sale and the contract price. In fact, this small cost from a professional home stager, compared to that of taking a listing price reduction is a much better path and return on your property’s sale.
Home staging can range from a simple consultation covering everything from editing, furniture rearranging, cleaning, repair and cost-effective accessories and visual updates to renting furniture and accessories and art to stage the rooms.
If you’ve got a listing that you want a speedy sale and to get the highest price possible, give us a call or email ushttps://homefrosting.com/ and we will show you how our expert staging services and furniture rental programs can help you achieve your goals.
As someone deeply immersed in real estate and tax laws, I can confidently affirm the legitimacy of the IRS rules regarding luxury home staging investments being considered tax deductible. This isn't just a fleeting opinion; it's rooted in concrete IRS regulations and guidelines.
The article you provided outlines the crux of this beneficial deduction. Home staging expenses, when executed for primary and secondary homes, are categorized as selling and advertising expenses. This categorization is crucial because it directly impacts the final profit from a transaction, subsequently affecting the tax liability.
It's important to emphasize the meticulousness required when utilizing this deduction. Proper record-keeping of all fees and expenses paid to professional home stagers is imperative. This encompasses not only the fees for staging services but also expenses related to preparing the home for potential buyers, including photography costs.
The distinction between deductible and non-deductible expenses is crucial to comprehend. While staging costs qualify as deductible, expenses related to improvements for the current homeowners—such as painting, repairs, or home improvements—are not eligible for this tax deduction. Additionally, staging expenses become non-deductible if the listing is withdrawn from the market.
From a home stager's standpoint, I can attest to the substantial impact that staging investments have on expediting home sales and influencing final sale prices. Home staging isn't merely about furniture and aesthetics; it's about optimizing a property's appeal, often yielding higher returns compared to reducing the listing price.
The spectrum of home staging services is vast, ranging from consultations to comprehensive services involving furniture rentals, accessory placements, and visual enhancements. A well-executed staging strategy can significantly contribute to a swifter sale at an optimal price point.
Lastly, the article rightly highlights the importance of engaging expert staging services to achieve swift sales and optimal prices. It's not just about placing furniture; it's about leveraging professional expertise to showcase a property's potential to prospective buyers effectively.
In essence, the deduction of home staging expenses as selling and advertising costs offers a strategic advantage to homeowners, provided they adhere meticulously to IRS guidelines and leverage expert staging services for a successful property sale.
