Need something new and amazing at your commercial property?
Something to wow prospective new tenants?
A nature-themed exercise trail, maybe? How about a new outdoor common area? A modern, appealing landscaping re-do?
If you’re not jumping on this, your competitors probably are.
We can hear you pondering all the dollar signs.
But remember, many landscaping projects are considered capital improvements.
Is landscaping tax deductible?
Let’s take a look.
Is Landscaping a Capital Expenditure?
According to the Internal Revenue Service, a capital improvement meets one of these criteria:
- Fixing a defect or design flaw.
- Creating an addition, physical enlargement or expansion.
- Creating an increase in capacity, productivity or efficiency.
- Rebuilding property after the end of its economic useful life.
- Replacing a major component or structural part of the property.
Basically, a capital improvement adds to the value of your property in a significant way, as opposed to repairs and maintenance, which preserve existing value.
So, is landscaping a capital improvement?
Sometimes. It’s a good idea to check with your tax or accounting professional about your proposed project to be sure.
But here’s a look at a few projects that typically count:
Landscaping Capital Improvement: A Renovation
When’s the last time you updated your landscaping? If you’re like a lot of commercial properties, maybe it’s been a while.
If your plants were installed decades ago in full sun, they might be shaded now, and struggling.
Those shrubs that were planted 15 years ago, all lined up in a stiff row, look dated now, and are probably overgrown.
Landscaping doesn’t last forever.
Boost your curb appeal and present a more modern look with a landscaping update that includes appealing layers of ornamental grasses, flowering shrubs and trees, perennials, and annuals.
Significant commercial landscaping services like a renovation are usually tax-deductible.
Landscaping Capital Improvement: Appealing New Amenities
Want to attract new tenants? Or new employees who will stick around?
Add amenities they value.
A dog park. A tree-lined exercise trail. An outdoor common area for grabbing a fresh-air lunch or holding brainstorming sessions. Outdoor grilling areas with fire pits.
A comprehensive update adds appeal and interest — and likely counts as a landscaping capital improvement.
Landscaping Capital Improvement: Environmentally Friendly Features
If your landscaping is a couple of decades old, chances are it isn’t environmentally friendly.
People didn’t care as much back then.
Typical commercial property landscaping years ago needed a lot of water and a lot of fertilizer and weed control.
Attitudes are different now. The earth needs our help.
Updating your landscaping so it’s friendlier to the environment likely counts as a landscaping capital improvement.
And it will save you money down the road, too. How?
- Replace fussy, water-hogging plants with native varieties that need less water, fertilizer, and weed control.
- Upgrade your irrigation system with water-saving drip irrigation, water-saving nozzles, and sprinkler heads.
- Replace that old cement with updated porous pavers that handle water runoff with ease.
All great ideas — and probably tax-deductible.
Landscaping Capital Improvements: What Doesn’t Count?
Not all the commercial landscaping services you use to improve your property are considered capital improvements.
The mowing, fertilizing, and weeding your property needs to look great are vital to its curb appeal, and your company’s reputation.
But they’re routine maintenance, not capital improvements that significantly add to your property.
What about adding a nice bed of flowering summer annuals by your front entrance?
Nope. Actually, that’s a great idea — but not a significant enough addition to count as a landscaping capital expenditure.
Ready for Commercial Landscaping Services? Trust North by Northwest
Is landscaping tax deductible? Many times, yes.
Your tax consultant can tell you for sure. That’s their job.
Our job is to help you update and improve your commercial property so it attracts attention, brings in customers, wows new tenants, and makes your job easier.
If you get a tax break too, that’s a bonus.
Are you ready for stress-free landscaping? Schedule a time to meet with one of our experts today. We’ll gather the details, create a customized plan just for you, and you can stop stressing as we improve and beautify your Austin, TX industrial property.