example: purchased for 70,000. renovation costs of 7,000. sales price of 125,000 six months later. If I hold this property longer than one year, will this make a difference?

Sell and Rent Back

When we bought this house, the back portion had already been converted into a separate unit, but it was in really, really bad shape. We spent some money fixing it up, making it suitable to rent again. (Most of which was with Home Depot cards, etc.. as we figured the rent money from the tenants would pay these off anyway). We have been providing our tenants with monthly receipts, and will be claiming the income on our taxes, I am wondering if we can deduct a portion of the renovation costs? Or if there are any other deductions we can make, having a rental unit at the back of the house.. (we also live in the house, though it is a completely separate unit all of the heat and hydro to the unit is also separate).

Real Estate Professionals