Home office renovation

[Tracielutz]

I opened a home equity line to do a home office renovation.  The renovation began in 2023 and will be complete in 2024.  It will be a space where I meet clients, work and have displays.  Samples and inventory are in the old home office.  It costed around 95K by completion.  Which year should I file the expense in?  2023 or 2024 or both.  Also I paid down the equity line with my business income in 2023.  Is this deductible?  Any insight is appreciated.  

[ThomasM125 · Accepted solution]

You should enter the cost of the improvement in 2024, when you start using it for the business. The interest portion of the loan is deductible as interest expense on your business tax return.

[Tracielutz]

I did have to make a payment from my business to pay down the equity line as it was getting to high and at its max.  Is this payment deductible since all the expenses on the equity line are for the renovation of the home office?