Understanding the difference between repairs vs improvements can save real estate investors thousands in taxes. This guide breaks down IRS rules, examples, and smart strategies to classify property expenses correctly—so you can protect your profits, boost your property’s value, and avoid costly audit mistakes.

Not all rental property renovations are created equal. Some upgrades—like durable flooring, updated kitchens, and energy-efficient features—boost rental income and property value. Others, such as luxury finishes or pools, can drain your budget without increasing returns. Learn which improvements deliver the highest ROI and which ones to skip to keep your investment profitable and low-maintenance.