I recommend that you do not claim the home office expense reimbursement as a deduction for your S-Corp this year for these two reasons:
1.) Because of limitations imposed by IRC section 280A on businesses renting real estate from employees, the only legitimate way to take the home office expense is under an employee reimbursement plan (without a W-2, the reimbursement plan would not be considered valid).
2.) Your CPA friend is correct about regarding limiting the home office expense if the S-Corp has a loss. There is a tax court opinion where the court sustained the IRS' disallowance of a S-Corp deduction for home office expense reimbursements because the S-Corporation had reported net losses for the years that were audited. Since there is a loss before considering the home office expense reimbursement, it is likely that you would have the expense disallowed if the IRS ever did examine your S-Corp return for this year.
On the issue of depreciation: The tax code requires the recapture of allowed or allowable depreciation when you sell real estate. This means that the IRS can force you to claim recaptured depreciation income when you sell your home even if you did not take the deduction. When you start taking employee reimbursements through an accountable plan, make sure you are including depreciation into the calculation.
Accountable Plan: <a rel="nofollow" target="_blank" href="
https://www.irs.gov/publications/p463/ch06.html#en_US_2016_publink100034114">https://www.irs.gov/pub...>
Cunnigham v. Commissioner: <a rel="nofollow" target="_blank" href="
http://www.ustaxcourt.gov/UstcInOp/OpinionViewer.aspx?ID=1448">http://www.ustaxcourt.gov/UstcInOp/Op...>
