topic Started new small business in 2021 in Get your taxes done using TurboTax

Started new small business in 2021

Kee22 — Wed, 26 Jan 2022 23:48:13 GMT

I started a company offering a service that I go into client's home, but so much time is spent at my home. What can I claim as expenses and is there a general percentage allowed for such: internet, insurance, cell phone, etc?

Re: Started new small business in 2021

ColeenD3 — Wed, 26 Jan 2022 23:53:11 GMT

You have to have an official home office to claim expenses related to the home.

If you're self-employed, housing-related expenses such as mortgage interest, rent, utilities, repairs, and depreciation for the portion of your home or rental that you use to run your business are allowable expenses under the home office deduction.

You may be able to claim the home office deduction if your office is:

Used regularly and exclusively for your business, and
Is your principal place of business (both conditions must apply).

When you enter your home office information in TurboTax, we'll ask some questions to determine if you can claim the deduction and how much the deduction is worth. You’ll need information like the square footage of your residence and the rooms you worked in

Re: Started new small business in 2021

Kee22 — Thu, 27 Jan 2022 00:33:10 GMT

I also built a garage this year which houses my operating supplies for my business - boxes, packing materials, etc. Can I claim any of the building costs for the square footage used for business storage? The garage also stores my car and some home supplies - snowblower, mower, fans and other storage type stuff.

Re: Started new small business in 2021

MarilynG1 — Thu, 27 Jan 2022 00:58:15 GMT

The cost of building a garage would be a 'capital improvement' that gets added to the Cost Basis of your home.

Use the Cost Basis amount when asked for this info in the Home Office section in TurboTax. You enter your home details as Asset in this section to claim depreciation.

You can calculate the square footage of your business-related garage space and add it to the total Home Office square footage.

Click this link for detailed info on the Home Office Deduction.