Yes, you can do this, but please make sure that you enter the mortgage and property taxes only on the Schedule C (Self-employment/1099) office portion and do not enter it anywhere else on the return. Entering mortgage/property taxes on the Sch C office will automatically allocate the rest to Schedule A.
Mortgage interest and property taxes aren't included anyway on the W-2 employee use of the home since they would subject to the 2% of the AGI rule. That should ensure that you're not claiming those deductions twice.
First you need to make sure that you are dividing the one home office that you use for two businesses correctly.
You'll need to divide up the space and enter it as if you had 2 separate offices. The IRS doesn't provide explicit direction on how to do this, stating only that the method you choose be "reasonable."
The most important thing to remember is that the total amount of your home office square footage, when added together, should not exceed the total you would claim if you had just 1 business use.
For example, if you have 2 businesses and 1 office measuring 100 square feet that you use equally for both businesses, you could enter 50 square feet for each home office. Or if you use your home office more for 1 business than the other, you could enter 75 square feet and 25 square feet, respectively.
Wondering what a "reasonable" dividing method could be? Here are a few examples:
- One could be based solely on time. For example, if you use your entire office for each of your businesses, using it 60% of the time for 1 business and 40% of the time for another, you could divide the space 60/40.
- Another could be based solely on space. For example, if each business requires special equipment that takes up 50% of the office, you could divide the office 50/50.
- A combination of the above might also work. For example, you might have special equipment for 1 business that uses 50% of your office space. You use the other 50% for both businesses, splitting your time equally. As a result, you would enter 75% of your home office square footage for your first business and 25% for your second business.
Whatever method you choose, when you start entering home office expenses, enter the full amounts you paid during the time you used the space for either office. Do the same on your other office.
It might seem like you're entering everything twice, but since you divided up the square footage earlier based on how you use it, all of the expenses for the total square footage will be accounted for on your tax return.
TurboTax will calculate the correct expense amounts for each office, and the total expense amount will then be correct on your tax return.
Where do I enter Home Office information for my business in TurboTax?
· In the TurboTax search box, enter home office and press the Enter key.
· Click the Jump to home office link in the pop-up.
· On the Did you have any income and expenses for a business in 2014? screen, click Yes.
· Follow the prompts to enter your home office.
Where do I enter Home Office information as an employee in TurboTax?
· In the TurboTax search box, enter home office, employee and press the Enter key.
· Click the Jump to home office, employee link in the pop-up.
· On the Tell Us About the Occupation You Have Expenses For screen,
· Enter your occupation and click Continue.
· Follow the prompts.
For more information on the business use of your home, click the IRS link below:
http://www.irs.gov/pub/irs-pdf/p587.pdf Business Use of Your Home