Is Pool Maintenance Tax Deductible?

Pool maintenance is considered a personal, living, or family expense and is not deductible for most taxpayers. However, the Internal Revenue Service (IRS) allows for exceptions when the pool’s primary use is directly related to medical care or a business activity. These circumstances are narrowly defined, and taxpayers must meet specific criteria to qualify for a deduction.

Deducting Pool Maintenance as a Medical Expense

The most common way to deduct pool maintenance is for medical treatment. This requires a formal, written prescription from a physician recommending hydrotherapy for a diagnosed chronic illness or condition. The IRS applies a “primary purpose” test, meaning the pool must be used mainly for the medical care of the prescribed individual. Recreational use by other family members should be minimal.

Ongoing operational and maintenance costs, such as chemicals, electricity, cleaning, and repairs, are fully deductible as medical expenses. The initial installation cost is a capital expense and is treated differently. A capital expense for medical care is only deductible to the extent that its cost exceeds the increase in the home’s property value. For example, if a pool costs $50,000 to install and increases the home’s value by $30,000, only the remaining $20,000 is a deductible medical expense.

This deduction is limited by the Adjusted Gross Income (AGI) threshold. A taxpayer can only deduct the amount of their total qualified medical expenses that exceeds 7.5% of their AGI. For instance, if a taxpayer’s AGI is $100,000, they must have more than $7,500 in total medical expenses before any deduction is allowed. All medical expenses, not just pool-related ones, are combined to meet this threshold.

Deducting Pool Maintenance for Business Purposes

Pool maintenance can be a deductible expense when associated with a business activity, most commonly a rental property. If a home with a swimming pool is rented to tenants, the pool is considered a business asset. All “ordinary and necessary” expenses for maintaining the pool, including cleaning, chemicals, and repairs, are fully deductible against rental income.

For a home-based business, the deduction is only available if the pool is a direct component of its operations. For example, a licensed home daycare may use the pool for the children as part of its service. The maintenance expenses must be allocated based on the percentage of time the pool is used for business purposes. A standard home office for a consultant or freelancer would not qualify, as the pool has no direct connection to the business’s revenue-generating activities.

Documentation Needed to Support the Deduction

Record-keeping is necessary to support a deduction in an IRS audit. For medical use, the taxpayer must retain the physician’s written prescription detailing the medical condition and prescribed therapy. It is also important to keep all receipts for maintenance expenses, such as chemical purchases and repair work, along with utility bills to prove operational costs.

For business deductions, owners of rental properties should keep copies of lease agreements showing the pool as an amenity. For a home-based business like a daycare, records should include a business license and logs showing the dates and hours the pool was used for business. All related expenditure receipts are also required.

How to Report the Deduction on Your Tax Return

To claim pool costs as a medical expense, the total allowable amount is reported on Schedule A (Form 1040), Itemized Deductions. All medical expenses are entered on the form, which then calculates the deductible amount that exceeds the 7.5% AGI limitation.

For a rental property, maintenance costs are detailed on Schedule E (Form 1040) and deducted from gross rental income. For a home-based business like a daycare, the allocated pool expenses are reported on Schedule C (Form 1040), Profit or Loss from Business.