Which action would not affect the basis of a home?

Which action would not affect the basis of a home?

• A. Installing a new roof.
• B. Replacing windows with energy-efficient models.
• C. Painting the interior of the home.
• D. Building a deck.

Answer: (C)

The basis of a home is generally increased by improvements that add value, extend its useful life, or adapt it to new uses. Actions such as installing a new roof, replacing windows with energy-efficient models, and building a deck are all significant upgrades that enhance the property's value and thus impact its basis. In contrast, painting the interior of the home is considered routine maintenance rather than a capital improvement. While it may enhance the home's appearance, it does not materially add value, extend the property's useful life, or modify its use. Therefore, this action would not affect the home's basis, making it the correct choice in this context. Understanding the distinction between maintenance and improvements is crucial for determining how various actions influence the tax basis of a property.

The basis of a home is generally increased by improvements that add value, extend its useful life, or adapt it to new uses. Actions such as installing a new roof, replacing windows with energy-efficient models, and building a deck are all significant upgrades that enhance the property's value and thus impact its basis.

In contrast, painting the interior of the home is considered routine maintenance rather than a capital improvement. While it may enhance the home's appearance, it does not materially add value, extend the property's useful life, or modify its use. Therefore, this action would not affect the home's basis, making it the correct choice in this context. Understanding the distinction between maintenance and improvements is crucial for determining how various actions influence the tax basis of a property.