Is a kitchen remodel tax deductible? On your personal residence, no, not as a write-off against this year’s income. The IRS treats the project as a capital improvement, which means the tax benefit is delayed until you sell the home and shows up as a smaller taxable gain. Several side paths can produce savings sooner: interest on a loan used to pay for the work, medical expense deductions for accessibility changes, and depreciation if the kitchen sits in a rental or a home with a qualifying office.
Why a Personal Kitchen Remodel Isn’t Deductible Now
The tax code splits spending on a home into two buckets. A capital improvement adds value, extends useful life, or adapts the property to a new use. A repair just keeps things in working order. Replacing cabinets, countertops, and flooring is a capital improvement; fixing a leaky trap under the sink is a repair. IRS Publication 523 names “kitchen modernization” and “built-in appliances” as capital improvements that increase your home’s cost basis.1Internal Revenue Service. Publication 523 – Selling Your Home
Neither bucket produces an immediate deduction for a personal residence. The difference is that capital improvements get added to your basis, and basis is where the money comes back.
How Basis Lowers Your Tax at Sale
Every dollar you spend on a qualifying improvement raises your home’s adjusted cost basis. When you sell, your taxable gain is the sale price minus selling costs minus that adjusted basis. A higher basis means a smaller gain.
Federal law also lets a single filer exclude up to $250,000 of gain, and a married couple filing jointly up to $500,000, if you owned and used the home as your main residence for at least two of the five years before the sale.2Office of the Law Revision Counsel. 26 U.S. Code 121 – Exclusion of Gain From Sale of Principal Residence For most homeowners the exclusion covers everything and the basis adjustment never matters.
It matters when it doesn’t. Say a married couple bought for $400,000 and sells for $1,000,000. The $600,000 gain exceeds the $500,000 exclusion by $100,000, which gets taxed at long-term capital gains rates (0%, 15%, or 20% in 2026, depending on income). If they spent $150,000 on kitchen and other improvements along the way, their basis climbs to $550,000, the gain drops to $450,000, and the exclusion wipes it out. At a 15% rate, that’s roughly $15,000 saved. Track every improvement even if you think the exclusion will cover you; prices and plans change.
Deducting Interest on a Loan for the Remodel
If you finance the remodel with a home equity loan or HELOC and use the proceeds to substantially improve the home that secures the loan, the interest is deductible as an itemized deduction.3Office of the Law Revision Counsel. 26 U.S. Code 163 – Interest A full kitchen remodel comfortably clears the “substantially improve” bar.
The combined balance of your mortgage plus home equity debt used for improvements cannot exceed $750,000 ($375,000 if married filing separately) for the interest to qualify. That cap, originally set by the Tax Cuts and Jobs Act for mortgages taken out after December 15, 2017, is now permanent. Home equity interest used for anything other than improving the property that secures the loan is not deductible.
You have to itemize on Schedule A to claim it, so if you take the standard deduction this benefit disappears.
Kitchen Changes for Medical or Accessibility Reasons
A remodel driven by a medical need lives in a different part of the code. If the primary purpose is medical care for you, your spouse, or a dependent, the cost may be deductible as a medical expense in the year you pay it.4Office of the Law Revision Counsel. 26 U.S. Code 213 – Medical, Dental, Etc., Expenses
The IRS specifically lists “lowering or modifying kitchen cabinets and equipment” as an accessibility change that typically does not increase a home’s value. When the improvement adds no value, the whole cost counts as a medical expense. When it does add value, you subtract the added value and only the difference qualifies.5Internal Revenue Service. Publication 502 – Medical and Dental Expenses
Two limits apply. You must itemize, and you can only deduct medical expenses above 7.5% of your adjusted gross income. If your AGI is $100,000 and you spend $30,000 lowering countertops and widening doorways for a wheelchair, the deductible slice is $22,500. Only reasonable costs tied to the medical need count. Aesthetic upgrades bundled into the same project don’t.
Rental Property: Depreciation Instead of Basis
A kitchen remodel on a residential rental follows different rules. Instead of waiting decades for the basis to pay off at sale, you recover the cost through annual depreciation against rental income.
A capital improvement to a residential rental depreciates over 27.5 years under MACRS.6Office of the Law Revision Counsel. 26 U.S. Code 168 – Accelerated Cost Recovery System A $55,000 kitchen produces roughly $2,000 per year in depreciation deductions, offsetting rental income dollar for dollar. You report it on Form 4562 and carry the result to Schedule E. Ordinary repairs to the rental kitchen (a faucet replacement, patched drywall) are fully deductible the year you pay for them and go straight on Schedule E.7Internal Revenue Service. Publication 527 – Residential Rental Property
The Partial Disposition Election
When you tear out an existing rental kitchen and replace it, you’re disposing of the old components. Federal regulations let you elect a partial disposition, recognizing a loss on the remaining undepreciated value of what you removed.8Internal Revenue Service. Examining a Taxpayer Electing a Partial Disposition of a Building Without the election, you keep depreciating the old materials alongside the new ones, with no tax recognition that the originals are in a dumpster.
The mechanics are simple. Report the loss on your timely-filed return for the year the old components came out. No separate form or statement is required. Structural components that qualify include flooring, plumbing fixtures, sinks, walls, electrical wiring, and cabinetry. Most landlords doing a major renovation should raise this with their preparer, because the deduction is easy to miss.
Home Office Portion
If you run a business from a dedicated home office, part of the kitchen remodel cost may be recoverable through depreciation. The office must be used exclusively and regularly for business and must be either your principal place of business or a place where you meet clients.9Internal Revenue Service. Topic No. 509 – Business Use of Home
The kitchen itself almost never qualifies as the office. But under the actual expense method, you depreciate the business-use percentage of the whole structure, improvements included. If your office is 10% of the home’s square footage, 10% of the remodel cost depreciates over 27.5 years on Form 8829.10Internal Revenue Service. Form 8829 – Expenses for Business Use of Your Home
The simplified method, which gives a flat $5 per square foot up to 300 square feet, doesn’t let you depreciate improvements at all.11Internal Revenue Service. Simplified Option for Home Office Deduction Capturing a slice of the remodel means choosing actual expenses and accepting the extra recordkeeping.
The Energy Efficient Home Improvement Credit Is Gone
Through the end of 2025, homeowners could claim a credit of 30% of the cost of certain energy-efficient components installed during a remodel, up to $3,200 per year. High-efficiency windows, exterior doors, and heat pump water heaters were among the qualifying items. The credit expired on December 31, 2025.12Office of the Law Revision Counsel. 26 U.S. Code 25C – Energy Efficient Home Improvement Credit
If you installed qualifying equipment before year-end 2025 and haven’t yet filed your 2025 return, you can still claim it on Form 5695. For kitchen work completed in 2026 or later, no separate credit applies beyond the standard basis adjustment.
Records to Keep
The IRS requires you to keep records tied to your home’s basis until the statute of limitations runs for the year you sell.13Internal Revenue Service. How Long Should I Keep Records? In practice, hold onto remodel documentation for as long as you own the home, plus at least three years after filing the return for the year of the sale.
Save contracts, invoices, canceled checks, and credit card statements. Before-and-after photos help if the IRS ever asks whether the work was an improvement or a repair. If you claimed any part as a medical deduction, keep the doctor’s recommendation that establishes the medical need. All of this is easy to gather during the project and nearly impossible to reconstruct years later.