Home office deduction for husband and wife LLC

[NS1]

We will have K-1s from partnership return with form 1065. After a lot of reading, I figured the only way we can claim any home office expenses is as unreimbursed partnership expenses. The worksheet for figuring out Actual Expenses seems absolutely impossible to go trough..., so we would have to go with just the "simplified" home office deduction, which is basically $5 per square foot used for business. We use 273 sqf so we can claim $1,365. Do we enter this whole amount as "Business Use of Home" under each partner's unreimbursed expenses, or do we divide it on 2 and enter just half ($682.50) for each partner?

Please also correct me if any of my assumptions above are wrong. Thank you in advance!

[DanielV01 · Accepted solution]

Dividing it is an acceptable method.  This is the same principle as if you are a Qualified Joint Venture:  you may split the deduction but you cannot double-count it.  The simplified method does have its advantages over the "Traditional" Business Use of Home Deduction.  It is possible that the Actual Expense method gets a higher deduction, it also includes Depreciation of your home, which is subject to recapture (converting into taxable income) when you sell your home.  Given those factors, using the simplified method can make a lot of sense, and your calculations on how to claim it are accurate on how to do so.

[NS1]

Could you please explain in a bit the recapture issue when you sell the home? What exactly would we owe if we sell our current home, and we have used the Actual Expense method? We have a lot of repair expenses this year, but we plan to possibly sell the home next year.... so I am trying to see the pros an cons of using the Actual Expense method.