The office percent is what is allowed for any house related expenses for the office. The fact that you allow the dogs in the rest of the house, or the yard, is not something that would create a bigger expense for your office.
- Direct expenses for the dogs is allowed to be deducted 100% for your business.
So in this case it is OK to minus depreciation taken for the original costs? Yes, as indicated earlier.
Looks like I can ignore land and land improvements? - Yes or add them together to enter your land figure only if included in the total cost entered for the home.
You may have a better deduction using the simplified method. The nice part about this is that there will be no depreciation recapture when you sell later.
It's normal for an office percentage to be low in comparison to the whole house, which is what is required for actual expenses.
@LuLuna
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