That said, taxes can be difficult, as write-offs often depend on each tax filer’s unique circumstances. Anything the government handles seems to be unnecessarily complicated, and this is true with our tax codes. (Why don’t they just let a company like Disney or Google handle it? They always seem to do a good job!)
Since we can’t change the IRS, at least we can better understand how tax deductions work, and hopefully save a lot of money in the process.
Landscaping Deductions for Those With a Home Office (In a Nutshell)
If you are a sole proprietor or have a home office where you meet clients, you can deduct a percentage of the costs of landscaping. I mean, if your clients spend time in your home office, then you need to make sure that your home looks good, right?
Basically, if your lawn is a mud pit, and your fence is falling down, it’s going to have a negative effect on your business, right?
So, what percentage of landscaping costs can you deduct?
Important: The deductible portion of your expenses is based on the percentage of your home that is used for business.
- Example: So, if you have 10 rooms in your house, and your office is one, you can deduct 10% of the cost of landscaping on your taxes.
That might not sound like a lot, but if your landscaping and lawn expenses last year add up to something like $5000, that’s a cool $500 deduction!
Examples Of Landscaping Tax Deductions: Driveway, Lawn Care, Fencing, Sprinkler Systems, & More
Landscaping is one of the more complex types of tax deductions for you to take advantage. The IRS says that for items that are “inextricably associated with the land” that also improve the value of the land must be depreciated over 15 years. Already sounds pretty complicated, doesn’t it?
Here are some of the landscaping improvements that can be tax deductible:
- Driveway repairs are tax deductible
- Lawn care / lawn service
- Sprinkler system
- Fencing / Fences can be tax deductible
- Swimming pools (*Careful! only if medically necessary!)
So, What Landscaping Can I NOT Deduct?
The term “Landscaping” includes trees, sod, plants, grading, shrubbery, and architect fees. According to the IRS, none of these have a “useful life.” This means it’s not depreciated as a land improvement. and doesn’t qualify as a write-off. That is, unless your landscaping total is less than $500.
Ok, here’s where Uncle Sam starts to kick back on his “old cough medicine” and starts to slur his words again.
It seems like with any tax rule, there are exceptions. (Like deducting dry cleaning on your taxes) you happen to spend less than $500 on landscaping, you’re able to deduct the business portion in the year that you have the landscaping done. This helps you avoid the whole “depreciation” thing and allows you to deduct those trees and shrubs.
Here’s an example: Let’s say you purchased 50 rolls of sod at $10 each. In this case, you’re able to deduct the time-space percentage of the total because each individual roll costs less than $500.
Of course, you need to make sure that your receipt shows that you purchased roll bag separately.
How To Take Advantage Of Your Tax Deduction
So how do you take advantage of this tax deduction? There are a few steps you must take:
- Depreciate these expenses as part of your home over 39 years.
- If you had the landscaping done in the first year you started your business, you can add this cost as part of the price of your home.
- If you had the work done after you started your business, depreciate it separately as “home improvement” over up to 39 years.
- You don’t need to be a CPA or tax professional to make this work. Any good tax software like H&R Block or Turbo Tax will walk you through this!
Having a home business can give you multiple tax benefits. It’s important to know which ones you qualify for.
Skip the “Free” or Cheaper Version of That Tax Prep Software, Or You Might Miss Your Chance to Write-Off Landscaping
Sure, the top names in tax software offer free versions, but you’ll want the editions specifically for business owners and sole proprietors. They cost more, but a single deduction, like landscaping, can more than make up for that extra $50 you’re spending. Unless you have your CPA do your taxes, here are two versions to consider:
Landscaping, like most deductions, can be a gray area, so good job doing your homework!
Doing your own taxes can be difficult, (and stressful!) and the rules aren’t always black and white. Tax write-offs like landscaping often depend on each tax filer’s unique circumstances.
Also, anything the government handles seems to be unnecessarily complicated, and this is true with our tax codes. (Why don’t they just let a company like Disney or Google handle it? They always seem to do a good job!)
Since we can’t change the IRS, at least we can better understand how tax deductions work, and hopefully save a lot of money in the process. Grab a coupon for our featured tax software to save up to an extra $30 or more!