Trip to buy kitchen, can I add to basis?

Question

I took two trips of approximately 300 miles each round trip to buy my kitchen cabinets/sink/counter tops. Can I add these trips to the basis of my rehab? 
If so, how do I calculate that? Miles or actual? Can I figure from my residence or my rehab (my home is farther)?

Kyle Meyers · Answer

I typically capitalize my miles while rehabbing a property and then, once the property is in service, I deduct the mileage from that point on. You count the miles from your place of business. If you have a home office, even if you don't take the home office deduction, you can count mileage from your home. If not, you can count from your rehab property, which would be your first work location for the day. The trip from your home to the property would be considered commuting if you don't have a home office and therefore not deductible.

This is not tax advice.

Steven Hamilton II · Answer

Are you planning to rent it again?  If so you may deduct them otherwise you must add them to basis.

-Steven the Tax Guy

Your guide to IRS laws, rules and regulations.

Kama Ward · Answer

Thanks Mark and Kyle. It's not rented, so I will add it to basis unless some higher tax authority says no.

Kyle Meyers · Answer

Is it rented right now? If it is rented, available for rent, or you are fixing it up between tenants, I would deduct the mileage. If the property is vacant and you are just going to sell and not rent the property again, I would add mileage to basis.

Kama Ward · Answer

I'll be selling this property. I have owned it for more than one year (rented first). So it's capital gains 15% fed and 7.75% state.  Wouldn't it be better to add it to the basis rather than deduct if possible?  I'm not sure how to make that calculation if I have the choice.

Mark Updegraff · Answer

Why wouldn't you just deduct it as a straight deduction.  Either by mileage, or you can use gas & expenses.  I think mileage gets you the best deduction.  That way, you don't have spread out the deduction, you get it all in the year you drove.

I'm not a CPA

Trip to buy kitchen, can I add to basis?

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