O'Reilly logo

J.K. Lasser's Small Business Taxes 2013: Your Complete Guide to a Better Bottom Line by Barbara Weltman

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Home Office Deductions in General

Whether you own your home or rent it, you may be able to deduct a portion of the costs of your home if you use it for business. This is so for both employees and self-employed individuals. However, the law is very strict on what constitutes business use of a home. First, you must use the portion of your home exclusively and regularly for business. Then you must meet 1 of 3 tests. The home office must be:

  • Your principal place of business,
  • A place to meet or deal with patients, clients, or customers in the normal course of your business, or
  • A separate structure (not attached to your house or residence) that is used in connection with your business.

Exclusively and Regularly

Exclusive use of a home office means that it is used solely for your business activities and not for personal purposes, including investment activities. If you have a spare bedroom or a den that you have equipped with a computer, telephone, and perhaps a fax/modem, you cannot meet the exclusive use test for a home office if you also use that room as a guest room or family den. A kitchen will never qualify even though it is used for a legitimate business purpose because it is also used for personal reasons (although a portion may be used solely for business in some cases).

The exclusive use test does not require you to set aside an entire room for business purposes. You can meet this test if you clearly delineate a portion of a room for business. It must be a separately identifiable ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required