Home office deduction

Forum|Forum|5 years ago
October 3, 2020
2 replies
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My business income shows on a K-1 and a W-2. My business is run from home. why can't i take the standard home office deduction?

Best answer by Critter-3

Ok ... so you have an S-Corp that issues you a K-1 form correct ?

And the Corp doesn't own the home right ?

And you properly pay yourself as an employee and issue yourself a W-2 ?

If so as an EMPLOYEE you cannot deduct any employee business expenses from 2018 to 2025 (unless the rules are changed again). And since the corp doesn't own the home then it cannot take any OIH expenses either.

What the company can do going forward is set up an ACCOUNTABLE REIMBURSEMENT plan ...

https://proconnect.intuit.com/taxprocenter/tax-law-and-news/how-your-s-corporation-clients-can-use-an-accountable-plan-to-deduct-home-office-expenses/#:~:text=The%20S%20corporation%20gets%20a%20deduction%20and%20the%20shareholder%20gets,trash%2C%20and%20repairs%20and%20maintenance.

Critter-3Answer

Level 15

Ok ... so you have an S-Corp that issues you a K-1 form correct ?

And the Corp doesn't own the home right ?

And you properly pay yourself as an employee and issue yourself a W-2 ?

What the company can do going forward is set up an ACCOUNTABLE REIMBURSEMENT plan ...

AmeliesUncle

Level 15

This is one of many reasons why people with corporations pay much more in taxes (and/or IRS audits) by doing it themselves. You really should be going to a good tax professional for the corporation.