Home Office Tax Deductions Are Fantastic: Learn How To Do ItFor Robert Green CPA content on page 1 and 2: Copyright 2019 © GreenTraderTaxClient Letters 2019 © Thomson Reuters/Tax & Accounting 1Home Office Tax Deductions Are Fantastic: Learn How To Do ItSince 1999, the home-office deduction is no longer a red flag — millions of Americans benefit from this deduction each year. Countless taxpayers run businesses from home, and the IRS un-derstands this. The income-requirement rule also limits the use of this deduction for profitable enterprises, which appeases IRS concerns about abuse and hobby-loss businesses. Before the IRS liberalized home-office deduction rules in 1999, a more stringent requirement was that business taxpayers needed to meet clients in their home office. Now, the only requirement is administration work, and another principal office outside the home doesn’t negate the deduc-tion.Many small-business owners, including traders eligible for trader tax status (TTS), operate from a home office. Some of them also conduct their business from job locations using cloud compu-ting, apps, and mobile devices. They can qualify for the home office expense deduction in this situation, as well. The IRS does not permit investors to take a home office deduction.Convert personal home costs into business expense deductions. This same concept applies to many other items such as phone, Internet, furniture, fixtures, and more. Keep in mind that busi-ness income or TTS trading gains are needed to unlock most home-office deductions. If a busi-ness doesn’t have sufficient net income, the otherwise allowable home office deductions are carried over to the following tax years. (In this situation, hopefully, the person remains in the business and has net income in subsequent years to use the carryovers.)There are several special requirements and rules for the home office deduction. A home office must be exclusively and regularly used for business, meaning children and guests can’t use this room. Report “indirect expenses” on Form 8829 and include every expense and cost related to the home. For example, include depreciation or rent, utilities, insurance, repairs and mainte-nance, security, cleaning, lawn care, and more. https://greencompany.s3.amazonaws.c...uctions+Are+Fantastic-+Learn+How+To+Do+It.pdf
"The income-requirement rule also limits the use of this deduction for profitable enterprises, which appeases IRS concerns about abuse and hobby-loss businesses...."