There are numerous benefits associated with smart home systems and home automation, from convenience and comfort to financial savings and several others. One additional area here that you might not have even been aware of previously: Many smart home systems come with direct tax benefits.
At AVI Systems, we’re proud to offer a wide array of smart home and home automation services, from alarm and surveillance systems all the way to entertainment areas like 4k video and much more. We’re also happy to detail the varied tax benefits our clients have received over the years based on the use of our products and services, which may cover several potential areas. Here are the most important to take note of at tax season if you’ve recently installed or upgraded a smart home system.
Home Improvement Tax Breaks
Home improvement is one of the largest single areas when it comes to homeowner tax breaks, and various smart home installations tend to come with excellent tax credits. These credits arise via the expenses you incur to integrate the home, whether we’re talking about smart LED lights, a central vacuum system or any other areas.
Record these expenses and keep records of them. When you sell your home, any investment you’ve made into it will be added to the total original value of the home, meaning you’ll save money on taxes when you sell. Home improvement costs will not be taxed upon the sale.
Energy Tax Credits
Another major area to be aware of here are energy tax credits, which may apply to a variety of home improvement tasks you take on. Numerous equipment pieces may qualify for renewable tax credits, including several that are part of smart home upgrades. Speak to our team about which particular energy tax credits you might be eligible for based on the smart home upgrades you want to make.
If you finance your smart home in certain ways, these may also make you eligible for tax deductions later on. For example, many smart home upgrades are folded into a mortgage refinancing process – in this situation, any interest you pay is tax-deductible.
In addition, if you choose to use discount points during financing, you may be able to write these off on your tax bill. Points, for those who are unaware, refer to single percentage points of the total house cost, and they may be used to finance smart home upgrades.
Home Office Tax Benefits
Finally, particularly during these times of social distancing, more and more people are working from home in office spaces. There are numerous smart technology elements that may go into this theme, from connectivity areas to various devices you may utilize. If you can prove that you have a room in your home dedicated to business purposes, you can deduct any related costs from your tax bill, including smart devices.
For more on tax benefits that may come with your smart home system, or to learn about any of our home automation services, speak to the staff at AVI Systems today.