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Jacy
Jacy, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 568
Experience:  Nine years individual income tax preparation and consulting
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I work from home and now planning on getting a one bedroom

Resolved Question:

I work from home and now planning on getting a one bedroom apartment. From what I have read on the IRS website, I understand what I can and cannot write-off, but I am confused about one part. Can I use my designated office for recreational use AFTER business hours?

Example: The living room will be my office from 8am until 5pm. After 5, I would like to use the same room to watch tv, hangout with friends, etc.
Submitted: 6 years ago.
Category: Tax
Expert:  Jacy replied 6 years ago.

Hello,

 

Unfortunately, no. To qualify for a business use deduction, the area must be used regularly and exclusively for business. The only exception to the exclusive use test is for storage of inventory or for a home daycare business.

 

In your case, if you can portion off a small piece of one room that is all for business such as a desk space, then the square footage of that area is your business use amount.

 

Thank you for your question,

 

Jacy

Customer: replied 6 years ago.
Thank you for your answer. One more question for you:

If I make 90k this year and write off $4,000 for my home office expenses, do you think that would trigger any red flags from the IRS?
Expert:  Jacy replied 6 years ago.

As with most things with the IRS, audit risk depends on many factors:

 

Is it typical for your type of business to have a home office?

Are you writing off a substantial percentage of your home expenses (or is it minimal)?

Are you an employee or are you self-employed?

 

Self-employed taxpayers tend to be audited more often than employees.

 

Jacy

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