A blog post

Home Office Tax Savings Part 1

Posted on the 06 August, 2019 at 12:24 pm Written by in General, Taxes



If you own a business, then a home office provides tremendous tax savings.
Whether you operate your business as a proprietorship, LLC, or corporation, the home office deduction can save you thousands in taxes.
And one of the best aspects of this deduction is that it doesn’t cost you a penny more than what you already pay. That’s because it turns personal nondeductible expenses into business deductions that reduce your taxable income.
What qualifies:
To deduct an office in the home, you must pass the regular-use test.
What is regular use for the home-office deduction?
In its audit manual, the IRS states:
Regular use means that you use the exclusive business area on a continuing basis. The occasional or
incidental business use of an area in your home does not meet the regular use test even if that part of your home is used for no other purpose.
How do you prove regular and continuing use?
A log of time spent, and
Documents that corroborate the time spent.
To ensure compliance with the home-office rule that requires regular use, make sure that you use your home office an average of 10 hours a week or more.
Make an average of 10 hours a week your target until either the IRS or the courts give you a better
number. Next, make sure that you build proof that you worked those 10 hours or more.

Part 2 Next . . .