Contact UsPart of my condo association monthly fees are applied to reserve funds for capital improvements. When I sell my condo, can I apply the amount I spent on those improvements to my base when I calculate my capital gains? Does it matter if the association has not spent the funds when I sell? Also, if there are assessments (vs. fees) that I must pay for capital improvements, can I apply those against my gains when I sell my unit?
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Tax Professional Answers
John Stancil
The monthly fees that are for capital improvements and not maintenance can be added to the cost basis of your unit, thus reducing your gain. The same for any assessments.
Regarding the unspent funds, you have paid it in as capital reserve, you have no control when it is spent and it won't be refunded to you. You can certainly increase your basis for these funds.
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508 weeks ago
Regarding the unspent funds, you have paid it in as capital reserve, you have no control when it is spent and it won't be refunded to you. You can certainly increase your basis for these funds.