Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted Sep 25, 2021 11:12:56 AM

Do I include the purchase price of my home in addition to the cost of home office improvement for depreciation?

0 2 493
2 Replies
Level 8
Sep 25, 2021 12:32:55 PM

No, the purchase price of the home is not included.

Level 15
Sep 25, 2021 4:22:10 PM

yes you do if you are taking actual expense deduction (regular method) for home office.  you must exclude the cost of the land from the home cost.  then the home depreciation is prorated based on square footage of home-office to total square footage of home. Part III of form 8829

Regular Method
Taxpayers using the regular method must determine the actual expenses of their home office. These expenses may include mortgage interest, insurance, utilities, repairs, and depreciation.

Generally, when using the regular method, deductions for a home office are based on the percentage of your home devoted to business use. So, if you use a whole room or part of a room for conducting your business, you need to figure out the percentage of your home devoted to your business activities.

Requirements to Claim the Home Office Deduction
Regular and exclusive use.
Principal place of your business.