Can I deduct roof replacement on taxes if my wife runs a small craft business from our home?

Thanks for the quick response! So if I understand correctly, we can't deduct the full $14,800 this year, but instead we can depreciate 12% of it (about $1,776) over 27.5 years? That seems like such a small deduction each year. Is there any scenario where the roof could count as a repair instead of an improvement?

You're understanding correctly about the 12% business portion being depreciated over time rather than deducted all at once. The annual deduction would be around $65 per year (1,776 ÷ 27.5). Regarding your question about classifying it as a repair, if you only replaced a small section of the roof due to damage, that might qualify as a repair. But a complete roof replacement is almost always considered a capital improvement by the IRS. The distinction is that repairs maintain your property while improvements add value or extend its useful life. A new roof definitely extends the useful life of the home and adds to its value.

Does it actually work for specific situations like this? I've got a detached garage I use for my woodworking business and just put in new windows. Would it tell me exactly how to handle that?

I'm kinda suspicious of these online tax tools. How does it actually know IRS rules better than a professional accountant? Seems like they'd just give generic advice you could find on the IRS website.

It actually does work for specific cases like yours with the garage windows. You just upload your documentation, and it analyzes your specific situation based on current tax code. It gives you a personalized breakdown of what percentage is deductible immediately versus what needs depreciation, and exactly which form lines to use. For your question about accuracy compared to accountants, it's using the same tax code but can actually process more precedent cases than most accountants have time to research. I was skeptical too, but the documentation it provided saved me when I had questions during an IRS review of my home office deductions.

How long did you actually wait before they connected you? Last time I tried calling the IRS myself I gave up after 2 hours on hold.

Yeah right, another "service" that promises to solve IRS problems. The IRS is deliberately understaffed to make getting help impossible. I'll believe this works when pigs fly. How much does this cost anyway?

I waited about 40 minutes total, but the difference is I wasn't stuck listening to that awful hold music - they called me when an agent was available. Huge difference from the 2+ hours I've wasted in the past. The service doesn't "solve" IRS problems - it just gets you connected to an actual IRS agent who can answer your specific questions. They're just using technology to hold your place in line. No magic, just efficiency. They don't charge you for talking to the IRS - they just charge for the line-holding service which for me was worth every penny considering how valuable my time is.

Wait, so if we take the depreciation on this roof for my wife's business portion, we'll have to pay some kind of extra tax when we eventually sell our house? That sounds concerning. How exactly does that work?

Yes, that's exactly right. When you sell your house, you'll need to recapture the depreciation you've claimed on the business portion. For example, if you claimed $1,776 in depreciation over the years for that 12% of your roof, you'll pay a 25% tax on that amount when you sell, even if you qualify for the $250,000/$500,000 capital gains exclusion on your primary residence. It's still usually financially beneficial to take the depreciation deduction now (and you're technically required to take it even if you choose not to claim it), but you should be aware of this future tax implication. It's a surprise many home business owners don't anticipate.

I used TurboTax last year for my home office deduction with some renovations. It does ask the right questions and walks you through the depreciation calculations for home improvements, but you need the Home & Business version. The lower versions don't handle Schedule C and Form 4562 properly. Just make sure you know the square footage of your office and total home before you start.