What You Need to Know About the Home Office Deduction
IRS Tax Tip 2010-53
If you use a portion of your home for business purposes you may be able to take a home office deduction.
Generally, in order to claim a business deduction for your home, you must use part of your home exclusively and
• As your principal place of business, or
• As a place to meet or deal with patients, clients or customers in the normal course of your business, or
• In any connection with your trade or business where the business portion of your home is a separate
structure not attached to your home.
For certain storage use, rental use, or daycare-facility use, you are required to use the property regularly but not
Generally, the amount you can deduct depends on the percentage of your home used for business. Your
deduction for certain expenses will be limited if your gross income from your business is less than your total
There are special rules for qualified daycare providers and for persons storing business inventory or product
If you are self-employed, use Form 8829, Expenses for Business Use of Your Home to figure your home office
deduction and report those deductions on line 30 of Form 1040 Schedule C, Profit or Loss From Business.
Different rules apply for claiming the home office deduction if you are an employee. For example, the regular and
exclusive business use must be for the convenience of your employer.
For more information see IRS Publication 587, Business Use of Your Home, available at IRS.gov or by calling 800-
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