Can I use the home office tax deduction if I work at home part-time? 5 Answers as of November 17, 2010

I work from home developing a website. I do this part-time, but I still spend at least 15 hours a week on the project. I heard that you can get a tax deduction for using your home as an office. Would this apply to me, and how much could I deduct?

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Masson & Fatini, LLP
Masson & Fatini, LLP | Susan Fatini -Masson
The easy answer is yes, if you use a portion of your home for business purposes you may be able to take a home office deduction.

However, in order to claim a business deduction for your home, you must use part of your home exclusively and regularly: 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.

Moreover, the amount you can deduct depends on the percentage of your home used for business. And, your deduction may be limited if your gross income from your business is less than your total business expenses.
Answer Applies to: California
Replied: 11/17/2010
David Hoines Law
David Hoines Law | David Hoines
I would not recommend taking an office in home deduction invites an audit
Answer Applies to: Florida
Replied: 11/16/2010
LT Pepper Law
LT Pepper Law | Luke T. Pepper
You can but only for the percentage of time you work from home.
Answer Applies to: Pennsylvania
Replied: 11/16/2010
Givner & Kaye
Givner & Kaye | Bruce Givner
Yes. You can use the home office tax deduction if you work at home part-time. The Internal Revenue Code Section involved is Section 280A(c)(1), which reads as follows:

(1) Certain Business Use

Subsection (a) shall not apply to any item to the extent such item is allocable to a portion of the dwelling unit which is exclusively used on a regular basis

(A) as the principal place of business for any trade or business of the taxpayer,
(B) as a place of business which is used by patients, clients, or customers in meeting or dealing with the taxpayer in the normal course of his trade or business, or
(C) in the case of a separate structure which is not attached to the dwelling unit, in connection with the taxpayer's trade or business.

In the case of an employee, the preceding sentence shall apply only if the exclusive use referred to in the preceding sentence is for the convenience of his employer. For purposes of subparagraph (A), the term "principal place of business" includes a place of business which is used by the taxpayer for the administrative or management activities of any trade or business of the taxpayer if there is no other fixed location of such trade or business where the taxpayer conducts substantial administrative or management activities of such trade or business.

However, that Code section is not helpful, in and of itself. Go on the internet and get yourself a copy of IRS Publication 587, "Business Use of Your Home," also available at IRS.gov or by calling 800-TAX-FORM (800-829-3676).
Answer Applies to: California
Replied: 11/15/2010
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