When Is Lawn Care a Tax Deductible Expense?
Understand the IRS guidelines for deducting lawn care expenses. Discover if your property's use qualifies for a tax write-off.
Lawn care expenses can sometimes be tax-deductible, though the rules are not always straightforward. Whether these costs qualify as a deduction depends entirely on the specific nature and use of the property. Generally, personal expenses are not deductible, while those incurred for business or income-generating purposes may be.
Business Property Lawn Care
Lawn care for properties used directly in a trade or business is deductible. These expenses are considered ordinary and necessary business expenses under IRC Section 162. An expense is “ordinary” if it is common and accepted in the specific business, and “necessary” if it is helpful and appropriate for the business.
Examples of business properties include office buildings, retail spaces, or manufacturing facilities. Maintaining the appearance and functionality of these premises, such as through regular mowing, trimming, and landscaping, directly supports business operations.
Record-keeping is important to substantiate these deductions. This includes keeping receipts, invoices, and detailed records of the work performed. These records help demonstrate that the lawn care expenses meet the “ordinary and necessary” criteria.
Rental Property Lawn Care
Lawn care expenses for rental properties are deductible as ordinary and necessary rental expenses. These deductions fall under IRC Section 212, which allows for expenses paid or incurred for the management, conservation, or maintenance of property held for the production of income. This applies to both short-term and long-term rental properties, provided the property is held for generating rental income.
Maintaining a rental property’s curb appeal through regular lawn care can attract and retain tenants, supporting income generation. Such expenses are considered routine maintenance rather than capital improvements, which would be treated differently for tax purposes. Mowing, weeding, and fertilizing are deductible in the year they are incurred.
Landlords must maintain records, such as receipts and invoices, to support these deductions. These expenses are reported on Schedule E (Form 1040), Supplemental Income and Loss.
Home Office Lawn Care
Deducting lawn care expenses for a home office presents a specific scenario. If a portion of a personal residence is exclusively and regularly used as a principal place of business, a proportionate share of certain home expenses, including lawn care, may be deductible. This deduction is based on the percentage of the home’s total area used for the home office.
Lawn care falls under indirect home expenses, meaning the cost is for the benefit of the entire home, not just the office space. For example, if a home office occupies 10% of the home’s square footage, 10% of the lawn care expenses may be deductible. The IRS has strict rules for claiming a home office deduction, including the requirement for exclusive and regular use of the space for business.
While the IRS states that expenses for parts of the home not used for business, such as lawn care, are not deductible, Tax Court rulings have allowed a portion of lawn care costs in some home office situations. Taxpayers can use either a simplified method or the regular method to calculate this deduction, with the regular method requiring detailed expense allocation.
Personal Residence and Limited Exceptions
Lawn care expenses for a personal residence are generally not tax deductible. These costs are considered personal living expenses and are not eligible for tax write-offs. The IRS does not permit deductions for expenses that are purely personal in nature, even if they enhance the property’s value or aesthetic appeal.
However, there are limited exceptions where some home improvements, including those that might involve outdoor areas, may be deductible as a medical expense. This typically applies if the improvement is primarily for medical care for the taxpayer, spouse, or a dependent. For instance, grading the ground to provide access to the residence for a disabled individual could fall into this category.
Such medical expense deductions are subject to hurdles, including an adjusted gross income (AGI) threshold, meaning only the amount exceeding a certain percentage of AGI is deductible. These exceptions are specific and uncommon, and taxpayers considering such deductions should consult a tax professional for guidance.