The Home Office Tax Deduction
Yahoo Small Business: “When you use part of your home for business, you may be able to deduct expenses for what the IRS calls the ‘business use of your home.’ If you meet the technical requirements of the tax law, you should be able to deduct a percentage of many of the costs of running your home, such as utilities, rent, insurance, depreciation, mortgage interest, real estate taxes, and some casualty losses, repairs, and improvements (if they relate to the part of the house you use for business).”
Anonymous on April 3rd, 2005 11:30 am
While the IRS allows you to do this, this practice serves as a red flag and could increase the chances of an audit. In his recent book, Richard Yancey, a former IRS employee, confirms that the IRS views this deduction with suspicion. I have heard the same from an accountant.
Sara on May 9th, 2007 1:50 pm
Of course it increases the chance of an audit, Anonymous. However, the deducations are completely worth it. You just need to make sure you keep good records of everything and read all the rules carefully so you’re not breaking them. As a small business owner you should be doing all of that anyway.
Sara
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