Business Use Of Home Tax
 

I have never claimed "business Use Of Home" when filing my taxes. I have worked from my home for the past 5 years and have been told that it brings up a red flag to the IRS.

Do you any of your claim "business use of home" when filing your taxes each year ?

I never done it before until this year.

My accountant told me that I can deduct half my rent since I work out of home.

Hope this helps...

http://www.irs.gov/publications/p535/ch01.html



Business use of your home. If you use part of your home for business, you may be able to deduct expenses for the business use of your home. These expenses may include mortgage interest, insurance, utilities, repairs, and depreciation.

To qualify to claim expenses for the business use of your home, you must meet the following tests.
The business part of your home must be used exclusively and regularly for your trade or business.

The business part of your home must be one of the following.

Your principal place of business.

A place where you meet or deal with patients, clients, or customers in the normal course of your trade or business.

A separate structure (not attached to your home) you use in connection with your trade or business.


You generally do not have to meet the exclusive use test for the part of your home that you regularly use in either of the following ways.
For the storage of inventory or product samples.

As a daycare facility.


Your home office qualifies as your principal place of business if you meet the following requirements.
You use the office exclusively and regularly for administrative or management activities of your trade or business.

You have no other fixed location where you conduct substantial administrative or management activities of your trade or business.


Alternatively, if you use your home exclusively and regularly for your business, but your home office does not qualify as your principal place of business based on the previous rules, you determine your principal place of business based on the following factors.
The relative importance of the activities performed at each location.

If the relative importance factor does not determine your principal place of business, you also can consider the time spent at each location.


For more information, see Publication 587.

i write off my home office every year and have never had a problem so far. however, when i was renting an apartment, my accountant did not recommend that I write off my home office. don't know why.

Thank you all for the information. I might try it this year and see what happens, I do meet all the critera.

I have a seperate office in my house. Its being built as we speak. Almost done now. I got to pay tax this month I think. So when I get the call from my accountant I will be giving him all the receipts for building materials and labour.