I'll step in and back up what Khaleef said.  (I'm a tax preparer, too.)  You can't claim it unless the space is used exclusively for business.  If you use it for non-business reasons at any time, you cannot take the home office deduction.  If you don't keep good records in other areas, I'd be wary of taking the deduction.  It can increase your chances of an audit because the IRS knows that many people abuse it.

 

If you use the area only for business, keep good records, and remain in compliance with tax rules, then by all means take it.  :)

The space usage is definitely something to pay attention to.

Paul Williams - Provident Planning said:

I'll step in and back up what Khaleef said.  (I'm a tax preparer, too.)  You can't claim it unless the space is used exclusively for business.  If you use it for non-business reasons at any time, you cannot take the home office deduction.  If you don't keep good records in other areas, I'd be wary of taking the deduction.  It can increase your chances of an audit because the IRS knows that many people abuse it.

 

If you use the area only for business, keep good records, and remain in compliance with tax rules, then by all means take it.  :)

If you use the area only for business, keep good records, and remain in compliance with tax rules, then by all means take it.  :)

Frugal Confessions said:

I am definitely writing off my office--it is a room solely used for writing. Woohoo to tax write-offs! It'd be nice to not have to owe any taxes this year...but if I do, then that means it's because I'm making money from writing, so that's not bad, either:).

nerdwallet said:

I currently claim my home office.  As KNS mentions, the key is that you have to have a separate room dedicated entirely to home office use.  The space can't be a shared space.  Then the calculation is just % of square footage dedicated to the office.

 

I would also note that you can claim that same percentage of your utilities, and potentially your in-home internet connection.

KNS Financial said:

The calculation is fairly simple: square footage of the office divided by the square footage of the entire apartment/house, times the total expenses for the home. Of course, I am making this very simple, but you must have a space that is solely used for business purposes. What that means, is that you can't have a family room/office and take the decudtion on the 30% of the time that you use the family room as an office.

I use our 2nd bedroom to prepare taxes, meet with clients, and handle everything else related to the business, but since I also use the room to lift weights, I never claim it. Here is a brief article by the IRS as well as a link to Publication 587 (Business Use of Your Home): http://www.irs.gov/newsroom/ar.....38,00.html

I think I saw this formula, too.  Just gathering info right now.  Thanks!

Sustainable PF said:

The calculation isn't easy, and, if you get audited difficult to prove your office use.

First, you need to calculate the square footage of your home, and determine the % of which is the office space.

The difficult part is determining (and potentially having to PROVE) how much time you use that space for WORK/BUSINESS.

a = house sq ft

b = office sq ft

c = % of time office used for business

I think the formula then becomes (a/b)*c

When we rented a room, and use of our kitchen and laundry, in our home it was a bit easier to determine the write off due to C being 100% (full access any time).  I'm not sure how you could prove how much time you spent in a room working ... but I look forward to other responses here!

Just gathering info.  I plan to use a room in my new apartment for "work".  Just wanted to see if I could use it as a write off and if I do go down this route if I need to form a business entity to justify myself.  Thanks!

Suba @ Wealth Informatics said:

I am planning to, planning is the keyword here :) I will tell whatever I know, you can verify that for me with the professional lol!

On a serious note, I have done a lot of research on this, so do let me know if you have any questions. I will try my best to answer them.

I would also note that you can claim that same percentage of your utilities, and potentially your in-home internet connection.

I use our 2nd bedroom to prepare taxes, meet with clients, and handle everything else related to the business, but since I also use the room to lift weights, I never claim it. Here is a brief article by the IRS as well as a link to Publication 587 (Business Use of Your Home): http://www.irs.gov/newsroom/ar.....38,00.html

First, you need to calculate the square footage of your home, and determine the % of which is the office space.

The difficult part is determining (and potentially having to PROVE) how much time you use that space for WORK/BUSINESS.

a = house sq ft

b = office sq ft

c = % of time office used for business

I think the formula then becomes (a/b)*c

When we rented a room, and use of our kitchen and laundry, in our home it was a bit easier to determine the write off due to C being 100% (full access any time).  I'm not sure how you could prove how much time you spent in a room working ... but I look forward to other responses here!

On a serious note, I have done a lot of research on this, so do let me know if you have any questions. I will try my best to answer them.

Hope everyone enjoyed their Christmas!   For the new year, trying to manage my taxes better.  Is there anyone currently writing off part of their home as a home office?  Also, don't worry, any advice given will be further looked into with a tax professional.

Thanks!