TurboTax does not allow home office deduction ...

[RichLeja1]

I am having the same problem.  Unfortuantely, these steps did not work.  Any time frame on a fix for this issue?

[EdwardinCO]

That's odd.  I just did a friend's tax using my TurboTax "Basic" "desktop" (so called) program, and the issue was fixed -- this time the interview actually ASKED for the percentage of the business activity that was performed in the home office.

Have you updated your program recently?

[MrMike762]

Same problem here, only discovered it when comparing my 2024 with 2023.

Im never asked what % of my business is used at the home office.  Only how many months did I work 50% or more at home.

Had to use the forms mode to add the % of home office used in business

Was not triggered in the review.  My software is up to date.

This would have cost me a few hundred less of a refund

Absolutely insane, that on the night before tax day, this isn't fixed.    Really makes me lose faith in this software for next year

[RichLeja1]

My issue is that the software is showing the Gross Income limit as a negative number???

I saw other posts that said the software was using the wrong data source and a patch was pending.  I hope it gets fixed soon.

[AnnetteB6]

The percent of business use of the home office is missing from the calculation and therefore the result is that the calculation shows a loss for your business.

When you go through the Federal Review of your return, this error should be flagged and you can enter the amount on that review screen.  The amount to enter is the percentage of time that you spend in your home office making money for your business.  If all of your time is spent working in your home office for your business, then enter 100%.

You can also make the correction to the calculation using Forms Mode.  Use these steps:

• Click Forms on the top row of TurboTax.
• Go to Form 8829.
• Scroll to the section titled Line 8 Calculation Smart Worksheet and enter your percent of business use of the home office on line B.
• Click Step-by-Step at the top of the screen to go back to the input screens.

@RichLeja1 

[RichLeja1]

Annette,

The % of business use is input in this sheet (both in step-by-step and forms):

Yet, the Limit is still showing as Negative.  

This has got to be an error.....

[AnnetteB6]

It is not necessarily an error since the percent of business use for the home office is only 20%.  

Here is how the calculation works:

If the number entered for business use of the home office is less than 100%, then the calculation could take your profit to a negative number when using the simplified home office calculation.  If this happens, then the deduction is disallowed.

Here are the details about how the Simplified Home Office deduction works, and what could be causing the situation in your return.

For any home office deduction (actual expenses or simplified), the home office deduction is not allowed to take a Schedule C bottom line from a positive profit to a loss.  Therefore, before the home office deduction is calculated, the tentative profit or loss of the business is considered.  If the number is a loss, then no simplified home office deduction is allowed.  However, even with a loss, an actual expense home office deduction can be calculated and carried over to the next year.  Carryover is only possible when using the actual expenses, not the simplified method.  

The profit/loss number that is used to decide whether the home office expense is allowed comes from Schedule C line 7 minus Schedule C line 28.  If the result is positive, then that is the first step to get the simplified home office deduction.  

If the Business Conducted in the Home Office percentage is any number less than 100%, then the amount on Schedule C line 7 is adjusted by that percentage before the expenses are subtracted.  So even with what you expect to be a positive profit situation, the percentage of business conducted in the home office can drop the income to a level where the profit is negative instead of positive.  This means that the simplified home office method is not allowed.  Again, using the actual expense method can work, but the home office expense is carried over to a future year.  

@RichLeja1 

[RichLeja1]

Annette,

Thank you for the detailed response!  This makes sense.  I am not sure why the program does not give the explanation you gave below for this section.  The feedback is very limited and doesn't help at all.  On the tax side, I don't agree with the tax logic that you need to have a very high Use % to get any deduction at all.  My wife spends many hours at home scheduling lessons and such.  But, she spends more time giving lessons.  So, it would be hard to get above 50%.   I don't think the simplied method is working very well if it isn't capturing this.  I agree that the actual method is way too complicated.  Oh well, there is nothing that we can do about this.  Thanks again for your very detailed explanation!!

[Tub70624]

I ran into the same issue and spent 2 days trying to figure out why it won't let me e-file. I filed for standard deductions for Home Office. For some reason at the time when adding that deduction in, Turbotax created a new line showing the standard deduction, AND also created an empty line with no information. So when you look at it, it may seem like you only have one Office Deduction, but there's actually (2) and you can tell because of the garbage can icon where you can select to delete the empty input. the empty line makes Turbo Tax thinks you have two offices and there's some stipulation about needing two forms, etc. etc. which is what triggered the error.

Once I deleted the empty line that was created by default under Office Deductions, it worked and I was able to e-file.

Hope this helps those in the same boat.

[OddTodd]

No, I am having the same problems as others expressed here and even more. Please understand I was using online tax software since GriffTax (which intuit either merged or bought) so I have been doing this a while with the same need.  I can tell you what it is as well. and that's the other problem your PREDATORY pricing like charging me $70 to file my daughter's university tuition and $2,500 summer job, because I transferred the tuition to our taxes. I have used TurboTax since you became available. One person in our family has always had a job where it was both working for a company but needed home office, tools and vehicles to do our job. Like I said 25 years I have always paid you handsomely for it. Since 2019 we added an online business to our home and every year we have NO PROBLEMS with declare business income and personal income using turbotax and it usually costs me $300 for my wife and I, and I am disabled with $14,800 disability but because there were income with home business it came to $300. I am so ticked for this, So this year instead I tried to do the home business version which I though would only cost me $140 but is going to cost me $210 because I am disabled, daughter was as mentioned and wife works harder than you can believe and this year it is NOT allowing any home office expenses to be applied for the entire home office set up where she spend 50% to 65% of the work. I really don't care how you take line whatever and deduct line B. Just tell us how and when you are going to fix it. I am in a panic because our yearly refund might not be a big thing to you but it is to us. $210 to $300 for 1 working woman, one disabled man and a former youth now at university with no job. And unable to safely or confidently file my taxes.