Our little enclave is a bit peculiar in terms of the city. I won’t go into all the details about how that is so. The relevant bit here is that the neighborhood got together to fund a proper widening of the road. There is only one road into the neighborhood, so we all have to use it (i.e. I didn’t benefit any more than anyone else).
Is this declarable in some manner on taxes? Normally, one would expect the city to do it, but our situation was weird, so they never did (even though they occasionally repair/fill cracks in the asphalt).
As a deductible expense for that year’s taxes? No.
You could potentially add the amount you paid to the basis of your home, if you consider it an improvement to your home. Here’s the IRS definition of improvements from IRS Pub 523 2024 Publication 523
The IRS does list driveways as allowable improvements in their list. But it would depend on the facts and circumstances of your particular situation, whether you would feel comfortable telling the IRS that it was an improvement to your home, like a driveway. And, I will also point out, since it would be an add to the basis of your home, it would really only be valuable to you if you were selling your home and had capital gains in excess of the exemption limit.
As for the “improvements” angle, it might be a stretch. There is the one road leading from the main city street. That road did not abut our property directly, it just leads into the neighborhood. It was narrower than it should have been, and lacked any sort of curbing, and tended to flood whenever it rained. It is now wider, has proper ribbon curbing, and during the rain last week, it did not flood. So it makes things better whenever I drive on that strip of road (about 100m in length, starting about 50m from our driveway).
Would an accountant be able to justify that? If not, I wouldn’t want to try to claim it. They collected about $2500 from every resident in the neighborhood to get it done (and the balance was paid by the guy building his new home at the entrance to the area, and the city was making him do the drainage and curbing adjacent to his new build…we just extended the widening and curbing beyond his new build since the crew was already there).
Is the road leading from the main city street owned by the city, or is it a private road, owned by the neighborhood?
I have seen a lot more developers building their own private roads as part of new developments, so it’s quite possible it’s a private road. But you indicated earlier that the city did some maintenance on the road, so that would indicate that the street is owned by the city.
If it’s a private road, it’s probably justifiable. If the road is owned by the city, then probably not.
I’ll have to inquire more. We have sewer with the city, and water, and trash pickup. No special contracts for those. The city street sweepers sometimes run through the neighborhood. But they didn’t put street lights on that road, like they do everywhere else.
As I said, the situation with the street has always been peculiar.
