Re: I have a home office and am itemizing expenses...
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wcwc1212
Returning Member

I have a home office and am itemizing expenses for this business. TurboTax asks about the cost of this home asset for depreciation purposes. Do I put the original cost?

I just started using my home in 2020 for a business. I purchased my home in 2013. What cost do I input here?
4 Replies
gloriah5200
Employee Tax Expert

I have a home office and am itemizing expenses for this business. TurboTax asks about the cost of this home asset for depreciation purposes. Do I put the original cost?

It is asking for the adjusted basis at the time you were placing the home office into use.  You will need to separate the land value and the building value for depreciation purposes. 

 

The class life of a home office used for a business is considered  non-residential use property with class life of 39 years.

 

For additional information, please refer to IRS publication 946:

IRS Publication 946

wcwc1212
Returning Member

I have a home office and am itemizing expenses for this business. TurboTax asks about the cost of this home asset for depreciation purposes. Do I put the original cost?

Hi,

Do I have to do the depreciation and deduction part?

I tried skipping that part, but TurboTax would go back to that page.

The reason I ask is because the home office is also used for personal purposes, and IRS Pub #587 says you can't deduct this if you use your home office space also for personal use.

 

 

 

Carl
Level 15

I have a home office and am itemizing expenses for this business. TurboTax asks about the cost of this home asset for depreciation purposes. Do I put the original cost?

The reason I ask is because the home office is also used for personal purposes

Then you don't qualify to claim a home office. Period.

The program asks two questions pertaining to your use of the space being claimed as a home office. I've paraphrased the questions here.

- Percentage of time you use this home office for business - You may only be in that home office 1 hour a day conducting business. But if for that one hour each day you occupy it, if it's only for business, then it's 100%. If you use that office or space for anything else, then it's not used 100% for business and you do not qualify to claim the home office.

- Percentage of business conducted in the home office - This will usually be less than 100%. For example, in my computer business a majority of my business is conducted "on site" at the client's location. I'm only in the home office conducting business about 30% of the time. When the office is occupied, I make/receive business phone calls, do invoices, order supplies, perform book keeping tasks, schedule jobs, etc.

 

wcwc1212
Returning Member

I have a home office and am itemizing expenses for this business. TurboTax asks about the cost of this home asset for depreciation purposes. Do I put the original cost?

Thank you.

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