Casualty Loss - Roof & Confused T/P

[taxbrewster]

I had a longer term client walk in today. Meeting went as smooth as possible until he said he wanted to deduct his new roof...I am just not sure this flies...

T/P built house 11 years ago. Placed 40 year shingles on the roof. We had a horrible ice storm this year, had leaking, and had to repair the roof at a cost of 13k. Says since the shingles did not last and the ice caused the damage he wants to write this off. Does anyone think he has a case? No, insurance claim was filed. I feel like this casualty loss area is very vague. Thanks in advance for the help.

[Virtual Managed Solutions]

I found this great article on IRS.gov. It is pretty descriptive and I think it may answer your question. Although, I would listen to others advice as well, because someone else may have experienced this type of situation already.

But here is the link [ http://www.irs.gov/taxtopics/tc515.html ].

[jainen]

>>this casualty loss area is very vague<<

There is some flexibility, but I wouldn't call it vague. The ice did not damage the shingles. They were in the same condition after the storm as before--old, worn out, and leaky. He can add the 13K to basis if the new roof constituted an upgrade in design or materials. Also, filing for any potential insurance coverage would be required for purposes of the deduction.

I know none of this is news to you--you are really asking for a good way to explain it to your client. See the definition of progressive deterioration in Pub 547 at http://www.irs.gov/pub/irs-pdf/p547.pdf. By the way, it isn't news to your client either.

[taxbrewster]

Yes, thanks for the links, I have done most of my reading there. I guess, I am trying to let the client down easy, but he says the ice damaged the roof. I would be more open to this if he just replaced the roof, but after 11 years, I believe it is just normal wear and tear.

Thanks again.

[Catherine]

Yes, thanks for the links, I have done most of my reading there. I guess, I am trying to let the client down easy, but he says the ice damaged the roof. I would be more open to this if he just replaced the roof, but after 11 years, I believe it is just normal wear and tear.

Thanks again.

He could go to the roofing manufacturer. Years ago I got money towards a new roof, courtesy of a class-action suit against the shingle manufacturer for faulty shingles. 40-year shingles should not fail after only 11 years.

Catherine

[RoyDaleOne]

I disagree, I think there is a possibility of a casualty loss.

Besides, roof repair maybe deductible as a repair, if it is not a betterment.

[TAXBILLY]

A deductible roof repair on a personal residence? News to me.

taxbilly

[taxbrewster]

Yep, I agree, it is not a rental, whole another story...

personal residence...the roof was returned to it's original status. T/P was just upset that he could not write off the loss because he believes the ice storm was a unexpected event.

[TAXBILLY]

I'm curious. Why didn't he make an insurance claim if he was so sure the ice caused it?

taxbilly

[RoyDaleOne]

My error!!! I wonder why that was not clearly said, because, you all know I need all the help I can get.

Activity has been on going in this area in 2008.

If you can see this article:

http://tax.cchgroup.com/News/FocusOnTax/FO...nk.net#Article1

[Virtual Managed Solutions]

..because it's easier to try and talk a tax professional into writing off than it is trying to convince an adjuster that God did it.

[TAXBILLY]

Blaming God is never a good idea. HE/She could put a hurting on ya! :~)

taxbilly

PS

Speaking about blame I see one senator said that it wasn't Daschle's fault that he didn't pay his taxes but it was the fault of the provider of the "free car and driver" because he didn't notify him that it would be taxable!