I have a large workshop at my house that I use for contract work + personal use (woodshop + working on cars). For work I use it to make things I need for work + store my work gear (video production).
in 2023, I spent ~$7500 building an addition onto the workshop thats used for storage + a dedicated office (storage to clear up floor space, dedicated office so I could get out of the house and focus)
I did all the work myself, those are all materials costs. The workshop has never been listed as a business asset, its was a building on a the property when we bought our house, and over the years, I've updated it and renovated the interior for general use. This 2023 work was the only time I did anything to it specifically for my contract work.
What, if anything, can I deduct?
It sounds like you now have a spot that is completely for your business separated from the rest of your personal stuff and use. If so, then the $7,500 addition would be a building asset and would be depreciated.
The key is regular use for storage and exclusive and regular use for the home office. You can enter this as a home office and walk through the steps to take the deduction.
It sounds like you now have a spot that is completely for your business separated from the rest of your personal stuff and use. If so, then the $7,500 addition would be a building asset and would be depreciated.
The key is regular use for storage and exclusive and regular use for the home office. You can enter this as a home office and walk through the steps to take the deduction.