Tax deductible home staging is a facet of the property staging industry which is very appealing to sellers. Many homeowners do not realize that US tax laws allow home staging costs to be written off federal taxes as part of real estate advertising costs when the home is sold. This allowance can facilitate enjoying the many benefits of home staging without any real risk, since the price of the service can be fully recouped when the house or apartment is sold.
Furthermore, since staging is essentially a no-risk investment, sellers feel much better about spending a little extra in order to really make their homes stand out from the crowd. This effort, in turn, brings in higher offers and leads to a larger profit on the sale.
This essay provides some background to the tax benefits offered by home staging.
Is Home Staging a Tax Deduction?
Home staging, as I have mentioned many times before, is not decorating. Decorating is not tax deductible. Home staging is actually real estate marketing, and as such, is tax deductible for virtually all property owners.
Home stagers fees, including furniture rental, art rental and other specifically incurred costs, are fully allowable as legal advertising deductions. However, any renovation work or redecorating that is not part of the staging plan is not tax deductible at all.
Therefore, it is wise to keep your aesthetic alterations in line with your stager’s recommendations and only splurge on full scale remodeling if there is no other choice. This way, you get the most benefit for your financial expenditure.
Tax Deductible Home Staging Considerations
It is always a good idea to talk to your accountant or tax specialist to fully understand what can and can not be used as a legal deduction on your taxes. Do not assume that you know, or even take your stager’s word for it, without getting qualified legal advice from a tax specialist.
That being said, the vast majority of staging clients are able to fully recoup their investment on home staging services and simply enjoy the added profit that their stagers have provided to them.
All in all, there are few investments which feature so little risk and so much room for potential reward in life and none even come close in the real estate industry. This is why home staging is a natural fit for any savvy seller.
Tax Deductible Home Staging Examples
Most of my own clients are happy to simply benefit from the wonderful staging plans that I help them to create. They see the changes in their home décor and are so grateful for the increased buyer satisfaction ratings they receive. However, when these clients discover that the cost of staging is a tax deduction, they often question if it can possibly be true. I mean, how can something which works so well to sell a home actually cost nothing once deducted?
I assure them, much to their delight, that this is true and that the benefits of staging keep on giving, even after the sale is made.