Major roofing project - tax questions

6 Replies

3 plex flat roof property has leaks on the inside, had a few roofers looked at it.

the scope of work involves:

1.Existing roof has many years of patching and patching and needs replacement, considering a tapered insulation system to give a bit of slope for rain runoff.

2.Many of the joists are rotted on their ends due to moisture damages and neglect, so a significant number of those need to be repaired by sistering a longer piece to tie it back tobwhere the members are solid.

3.Some plywood decks if rotted may need replacement, no telling now many until roofing membranes are torn off.

4.All wood fascia are to be replaced due to rot.

5.Repaint new fascia.

Am I correct that I should request two invoices two "jobs", item 1 is new roof to be depreciated, item 2-5 are repairs that may be expended one time?

I own a roofing company here in St Louis. Once you have the roof tore off you need to get it back on ASAP. I would Talk to a roofing company about doing all the work one bid. It should be just line items up charged depending on what is wrong.  You really can't see what your getting into all the way until the roof is tore off. We run into those problems all the time. Manly because people wait till the roof is leaking to call us out and that we deal with older homes a lot. 

If the roofing co does not have a good guy that is comfortable sistering joyeuses. You might want to find a better company. 

Also I suggest taking the days off or stopping by a lot when they're doing the job. Always best to keep an eye on things. 

Best of luck to you. 

Medium mogul logo web smallPeter MacKercher, Mogul Realty | [email protected] | 314.210.4414 | http://stlmogul.com | MO Agent # 2010004223

Originally posted by @Peter MacKercher :

I own a roofing company here in St Louis. Once you have the roof tore off you need to get it back on ASAP. I would Talk to a roofing company about doing all the work one bid. It should be just line items up charged depending on what is wrong.  You really can't see what your getting into all the way until the roof is tore off. We run into those problems all the time. Manly because people wait till the roof is leaking to call us out and that we deal with older homes a lot. 

If the roofing co does not have a good guy that is comfortable sistering joyeuses. You might want to find a better company. 

Also I suggest taking the days off or stopping by a lot when they're doing the job. Always best to keep an eye on things. 

Best of luck to you. 

 Peter, thanks.  I am getting a roofing company to do all this work except painting the fascia.  What I meant was one bid, but two invoices, one for repairs and one for just the new roof so I can use them differently for tax purposes.  The replacement plywood deck, wood joists, fascia will end up to be almost as much as a new roof.

Sounds good thanks for clearing everything up. 

Let me know if you have any questions. 

Medium mogul logo web smallPeter MacKercher, Mogul Realty | [email protected] | 314.210.4414 | http://stlmogul.com | MO Agent # 2010004223

Not an accountant, but I think this would be treated as one big capital improvement and the whole job would be depreciated.

@Steven Hamilton II what's your take?

Jon Holdman, Flying Phoenix LLC

@Steven Hamilton II Thanks.  So even if the wood work that are necessary for repair it is still considered cap improvement and has to be depreciated and not repaired?

Actually the project is even bigger in scope.

Problem - roof and ceiling leaks in two units, drywood termite infestation in two units, very likely the two issues are related, roof leaks caused wood rot, wood rot might have attracted the termites etc...There is also evidence of subterranean termites.

So the order of work:

(1) Subterranean termite treatment - perimeter trench and concrete slab drilling with termidor application.

(2) Roof demolition down to sheathing.

(3) Repair rotted wood deck and wood joists.

(4) New roofing membrane and flashing work.

(5) New fascia and new drip edges.

(6) Tenants leave for 3 days.

(7) Drywood termite fumigation.

(8) Tenants move back in.

One pest control company will deal with the subterranean termite treatment.

Another pest control company for the tenting and fumigation.

One roofing company for all roof work and wood repair.

One painting company for fascia painting.

Plus reimbursement to tenants for loss of use (rent credit), lodging, food etc...

I assume tenant reimbursement and termite treatments are expenses?  The rest is all capital improvement?
If they are both capital improvement is there any benefit to break it out then?