My senior citizen severely disabled client has a 2.2 million residence in Berkeley hills. She installed a $13K electric staircase necessary to enable her to go up a flight of stairs. The question is...how much would the staircase increase the FMV of the house? My guess is nothing significant. It might even reduce the value. What millennial couple would want a house with an electric staircase?
I'm projecting a $2500 saving in taxes ( she isn't wealthy other than her residence) if she takes the total $13K as a deduction. How would you handle this situation?
BTW real estate in Berkeley hills are raising astronomically..(8+% per Zillow)...so again I don't think $13K improvement will have any affect on FMV.
Did she wake up one morning and find herself severely disabled? How was she getting up the stairs before that? Those aren't my questions, but those might be the questions of an IRS auditor. (I've already told the story about the one who wanted proof that donations to the Catholic church are deductible.)
Clients here in Phoenix, where prices are only increasing by 20%, modified their house, mostly at VA expense, a few years ago for a handicapped resident. When the house was sold last month, the modifications were removed on the advice of the Realtor who thought they added no value and limited marketability.
Is there any salvage value or is this a permanent installation?
"I'm projecting a $2500 saving in taxes ( she isn't wealthy other than her residence)"
You indicate the medical deductibility threshold for itemization means there is a significant savings, but you also state she isn't wealthy? Not that wealth has anything to do with whether this is medical or basis, of course.
"What millennial couple would want a house with an electric staircase?"
One with a multi-generational family, one with a disabled adult in the home, one with an injured person in the home, one with a pregnant person in the home, one with a disabled vet in the home. I can think of a lot of reasons this might be attractive. It depends on if this is just a fold-down seat, a full unit that impedes on the regular use of that same staircase, a secondary staircase, is it easily removable?
Yes, they should have a real estate agent give them info on this type of addition in their area. It doesn't have to be a full blown appraisal.
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