I am a professional sculptor. May I deduct the cost to build a seperate building on my property as an art studio?

[PatriciaV · Accepted solution]

Yes, you may include this building in one of two ways.

1) As a business asset (non-residential real property) that depreciates over 39 years.

2) As a Home Office asset (same depreciation method).

Either option requires regular and exclusive use of the space for your business.

You choice may be influenced by costs related to the building. If the costs are shared with your home, the Home Office Deduction may be a better choice. 

But if you have separate utilities for the building and track all expenses separately, adding this as a business asset may have a greater affect on your self-employment income.