Question

Capital Improvement - Fence

Forum|Forum|4 years ago
March 10, 2022
1 reply
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I bought my home in NC in 2021 and had a fence installed. The installer required me to sign a E-589CI Affidavit of Capital Improvement and charged me sales tax, do I have to pay any capital improvement taxes on top of the sales tax?

KrisD15

No, that form is used by the fence contractor to substantiate to the state what type and amount of sales tax he charged you.

Since the fence is categorized as a Capital Improvement, you can add the cost to the basis of the property.

When you sell, you might need to claim Capital Gain and the cost of the fence might lower your Capital Gain. (Selling Price - Basis = Capital Gain) although there would be many other factor to also consider.

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