Los Angeles, CA asked in Tax Law for California

Q: I have an LLC’ on a house that is not generating any income. Can I take the cost of refurbishing the bathroom on my tax

Also there is a very large utility bill owed & now services has been interrupted. Can I take claim that on my taxes if I pay it?

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1 Lawyer Answer
D. Mathew Blackburn
D. Mathew Blackburn
  • Tax Law Lawyer
  • Englewood, CO

A: It depends on if your intent is to create an income producing property or an investment property. It also depends if it's a repair or an improvement.

From what you described this sounds like an improvement on an investment property so it would not be deductible but it would be added to basis decreasing the gain on sale.

Utilities are deductible for both rentals and investment property as long as the property is not being used personally. You can't have a vacation home and call it an investment for the deduction.

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