So When Can You Write Off A Home Office?

If you own a home business and do your work on the kitchen table, sorry, you probably can’t take any deductions. The IRS is very specific as to what constitutes a home office. There are three words to remember: exclusive, regular and principle.

EXCLUSIVE - The part of your home used for business must be used exclusively for business. Ex: You run a home business form a spare bedroom. And you also email your PTA committee, share the office space with a spouse and sometimes catch up on your favorite show form that bedroom. Because the room isn’t used exclusively for business, you won’t be able to write it off.

REGULAR – The part of your home used for business must be used on a regular basis. Ex: You rent an office or studio downtown. Once in a while you bring home a client to view samples. This does not constitute regular used of the room.

PRINCIPAL – Your home office, studio or workshop must be your principal place of business. Ex: You have a dog-walking business. But you’ve dedicated your den just for bookkeeping for your business. You can write of this space even though most of your business occurs at parks and fire hydrants.

To learn more about this subject contact us at Nolting Real Estate at 636-391-9997. Also contact us about Real Estate in your area!