Schedule C & Form 4562 - Taxpayer & Spouse use home as an office. Are we able to record the house Asset in two separate ways? One of use using purchase price and the other just the improvements, which are more than the purchase price?

For instance, the taxpayer uses the 2004 purchase price, but the spouse uses all improvement costs from 2015-2022 as Cost of the Home. Taxpayer uses house for 25% of independent contractor/property management and spouse uses house for 100% of independent/accounting service. Or do we both have to use the same method of recording the Asset?

1101

Expert Alumni

Feb 25, 2023 7:34:24 AM

You must both use the same cost basis for the home when depreciating a qualified home office.

Keep in mind that it is not possible to claim 100% of a home as a qualified home office unless the business claiming the use of the home is a daycare. Even then, if there is a second home office for another business, that portion of the home must be exclusive to that business. So the daycare use would be less than 100% in that example.

Two businesses claiming home office space in the same home cannot have overlapping space or the offices would not meet the qualifications.

To learn more about claiming home office expenses, take a look at the following TurboTax help article:

The Home Office Deduction

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Schedule C & Form 4562 - Taxpayer & Spouse use home as an office. Are we able to record the house Asset in two separate ways? One of use using purchase price and the other just the improvements, which are more than the purchase price?