Recording and Reporting On Capital Improvements to House

Tommy3

I have a property account called "MyHouse". When I bought the house, I recorded the transfers to it from "MySavings" and "MyMortgage" accounts. Thus, at day 1, the balance of "MyHouse" was purchase price. Every week, I "Check for Updated Zestimate" to add "Market adjustment" types of transactions to update to the latest market value.

Now, I've been spending money to maintain the house. In most cases, they are expenditures from other accounts (e.g., credit cards) where I can record the purpose, and set an appropriate Category, e.g., "Furniture", "LawnCare", etc. Some however, I consider capital expenditures. For example, I installed a new wall-to-wall carpet. Normally, I would simply record this transaction in one of my registers as an debit expenditure, and in this case, set the Category to "Furnishings".

What I'd like to do is also recognize this carpet transaction as a capital expenditure as well as for "Furnishings".

In an ideal case, I'd like to run a Category report which splits out not only by category, but by capital expenditure vs non-capital expenditure.

What's the best practice for doing this?

NotACPA

You've basically got, as I see it, 2 options.

You can create an Improvements (however you name it) category … OR you can simply record home improvements as transfers into your MyHouse account … thus increasing the value of MyHouse.

Just be cautious, and read the appropriate IRS literature regarding what's a Repair vs. what's "Improvement".

Rocket J Squirrel

Updating your home value from Zillow is providing you bad information.

What you really need to track is the home's cost basis for tax purposes in case you ever sell. So true improvements would be added to the home account. Changes in Zillow value would not.

I suggest keeping basis in one Quicken account and tracking market ups & downs in a second account. Add them together for current market value.