Why does my Self-Employed income not qualify for any home-office deduction if I worked 99% of those hours from that home office?

emilylouise-walk · ‎June 3, 2019

MichaelDC · ‎June 3, 2019

Did you have a profit in this business?

emilylouise-walk · ‎June 3, 2019

Yes, it's IT contract work that I do in addition to my regular Job. Both are done from the same home office, for a total of 40 hours per week.

MichaelDC · ‎June 3, 2019

Thanks. It's probably to do with answering a question incorrectly. As hinted in my comment question, the home office can't be taken unless you have a net profit after expenses and it can't get you a loss in the business.

emilylouise-walk · ‎June 3, 2019

I think the problem is that TurboTax is asking me if I use the home office "exclusively for this business" - and I have to say "NO", since there are 2 businesses technically sharing that home office area. I do 2 hours per day for one, and 6 hours per day for the other.

MichaelDC · ‎June 3, 2019

Converting the above comment to an answer for others' benefit. Please let me know if you need anything else here. Thanks.

MichaelDC · ‎June 3, 2019

Very nice catch. You should set up 2 separate offices. You can allocate the SPACE by any reasonable method (income earned or time spent). So, for example, if you have a 200 sq ft office, the Self-Employed office can be 150 sf and the employee home office can be 50 sf or vice versa.

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Why does my Self-Employed income not qualify for any home-office deduction if I worked 99% of those hours from that home office?

Deductions & credits

Deductions & credits

Deductions & credits

Deductions & credits

Deductions & credits

Deductions & credits