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CO online Form 8829: What You Should Know
How to Deduct Your Home Office Expenses With This Home office Expenses Calculator Tool May 18, 2025 — If you plan to claim the home office deduction on Form 8829, you will need this tool to help you work out how much you can deduct. Related Home Office Deduction Articles : Home office expenses are tax-deductible for businesses or owners of homes if the business or home is used exclusively by the business or owner for a qualified business purpose. Deductible Home Office Expenses for Business Use of Your Home The home office deduction applies to owners with at least one property in a residence, with or without a rental unit. The home office deduction also applies when renting from a person who has no part ownership interest in the renter's residence. Qualified Business Purpose Qualified business purpose means the primary activity of the home office is business. For example, a home office for a self-employed person is the business activity of running the business. If the home office is the sole activity of the spouse, then the spouse is the only qualified business owner under the home office deduction, even if the other resident has a part ownership interest in the residence. The primary activity test applies for your home office deduction to determine whether you can claim the home office deduction. It is also an important test for the home office deduction when it applies to renters. If you have a rental unit, and if the deduction is claimed for the primary home office activity, the rental unit will be excluded in the calculations. Rental Activity If the rental property is the home office for your sole business purpose, and it is either your principal place of residence, or an integral part of your home, the home office deduction is limited to the rental fee component. That means that an eligible home office expense is one that is: Deductible in the year for which you are entitled to claim an amount of rental income. Detected by a section 1204(f) deduction schedule, generally starting in the year of its original installation. To find out what the schedule is, go to IRS.gov and click on Revenue Procedure 2008–39. See Regulations section 1.1204-3(d)(7) for more information. If all your home office expenses are for business (or for self-employment purposes), then Section 1204(f) of the IRS regulations determines the deductions each person can claim as a “related business.
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