is drilling a water well tax deductible

2023-06-29

Although you may have been pondering the possibility of investing in a water well, one query likely on your mind is whether the financial cost is tax deductible. The answer is not always so cut-and-dried, but it hinges largely upon how the IRS categorizes its purpose and utilization.

If you are looking to lower your tax burden, it’s important to understand that the cost of a well is only deductible if utilized for irrigation or business purposes. For example, if you need a water source for your lawn or swimming pool, the cost of a well is not applicable as a write-off.

The Internal Revenue Service considers wells utilized for irrigation and company purposes as long-term investments. This suggests that rather than compensating the total expenses all at the same time, these costs can be spread over a duration of time. The specific deduction relies on the kind of business you own, but generally it’s 20% on each year.

When considering the drilling of a water well, consulting with an accountant could be a wise choice to explore the potential of deducting related costs come tax season.

Related Products

Warning: Use of undefined constant rand - assumed 'rand' (this will throw an Error in a future version of PHP) in /www/wwwroot/www.sunritawdr.com/wp-content/themes/msk5/single.php on line 65