Can garden expenses be tax deductible?
Although most of us are still feeling the effects of the recession, finding every deduction you can to offset whatever you earn during the year is still important. As we approach the April 15th tax deadline take a close look at what can help your overall tax liability.
Gardens may not be ordinarily tax deductible, but there are times when they can be claimed. If your garden is an essential part of how you earn your income, it may very well be a legitimate expense.
For the ordinary home owner, expenses involved in home improvements can be deductible – especially if you maintain a home office. And improving your landscape may be considered a legitimate home improvement – especially if people come to your home as a place of business and the visible entry landscaping is part of your work space or sales product.
If you sell any materials you grow in your garden like vegetables, fruit, or cut flowers, expenses involved in growing these materials could also be deductible. Keep in mind you first have to declare any income you’ve received from the sale of what you’ve produced. In this case the deduction must be a business expense.
If you work in the green industry in any capacity – as a gardener, landscaper, designer, as someone working at plant or garden product sales, etc. – then you may be able to deduct the cost of materials and labor as an educational, demonstration or other applicable expense.
If you sell your home, landscape repairs and garden improvements can be considered an expense for ‘curb appeal’ or ‘necessary repairs’ that can be deducted from the profits you declare for taxes on the sale of your property.
If you have another business where you can actually conduct classes, sales, demonstrations or other events in the outdoor garden, then your landscape might be considered a business space. This might be another opportunity to use your garden as a deductible expense.
Before you decide what garden expenses are allowable tax deductions, do your research. It is best to keep complete records of both your income and expenses on a regular basis during the course of the tax year. Using a computerized tax program to input your transactions as you go through the year will make calculating your annual taxes much easier. If your taxes are very easy you can even find free software, but if you have your own business or hope to take any deductions chances are you will need more detailed help and should buy software that offers the functions you need. Whatever you spend on the right tax program should be worth the expense by helping you prepare the best report possible for your taxes. That should save you money.
You can also talk with a tax consultant, have a professional review the tax papers you’ve prepared for yourself, or have a professional do your taxes for you. When considering whether you can deduct expenses from your garden or landscape, it is always advisable to check with a professional first. Tax laws are always changing and garden deductions could be tricky for those not familiar with IRS terms and definitions.
No matter who actually does your taxes, it will be up to you to gather all the information that will go into figuring your tax returns. So if there is a way you can make your garden tax deductible, don’t miss out on the opportunity. If it is too late for you to consider how to make your garden tax deductible for this year, now’s the time to start planning how to benefit for next year’s returns.
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