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jtahsiri
New Member

How do I connect the rental income from Schedule E to home office deductions

 
2 Replies
gir0106
New Member

How do I connect the rental income from Schedule E to home office deductions

Previous answers to this question claim you cannot claim the home office deduction on Schedule E because it is 'passive' income.  This is incorrect.  Courts have ruled against the IRS on this question, and as long as you satisfy all of the requirements ... ALL ... you may use the deduction. This would normally mean you are licensed in real estate and being a landlord is something you do as a business as opposed to someone who just owns rental property as a sideline. If you are paying someone else to manage your properties or find tenants you probably wouldn't qualify.  However, even though the IRS has lost on this one, they don't make it easy - there is no mention in IRS support documents of how to claim it.  Since they don't say how to do it, just enter it as an 'other' expense (line 19) and refer to Form 8829 you also fill out.  Refer to your accountant if you are unsure whether you qualify.
ghzhujwmao
New Member

How do I connect the rental income from Schedule E to home office deductions

8829 can not generate expense if the business income is zero. When using Schedule E for rental income, it is not defined as business. How can I overcome such issue?
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