Tax Planning:

In 2003, Jack bought a cabin and forty acres up north. He visited the cabin frequently and while there provided general maintenance and cleaning. On separate trips he also made improvements like installing air conditioning, building a deck and woodshed. He’s kept records of his expenses and mileage driven for every time he’s visited the cabin. In 2019 Jack sold his cabin and would like to write off his mileage driving to the cabin for improvements along with all miles for his general maintenance and vacationing trips. Would his mileage for his trips where he provided general maintenance and cleaning also be added to his cost?

No. The mileage to maintain a personal asset cannot be added to its cost. When sold, personal assets are either reported as a taxable gain or as a nondeductible personal loss. Costs to improve a personal asset can be added to the basis while costs to maintain it are personal and nondeductible.

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Tim Legois CPA

Tim Legois CPA

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