Can I rent a room in MY house to MY business (not referring to the home office deduction)

[ghoolko65]

This is based off another question I read here (but dated a year ago) where someone asked about renting a room in someone else's house for his own business. An 'Expert' here responded that yes he could do this and then proceeded to respond as if the Poster was asking about home office deductions. 

So my question pertains to Me renting a room in My house to My business which is an LLC. (technically a home based business). My understanding is the IRS does not recognize this as a separate entity since the LLC is the person, and the person is the LLC (pass through). Which means I would have to take the home office deduction, but cannot actually rent a room to my business and deduct the rental fee (for example if  my business pays me personally $350 per month for the room).  I'm looking for the situation similar to when I had an office outside of my home, with a lease agreement, and paying monthly for a co-working space.  Doing this allowed me to deduct the office fee.

[VolvoGirl]

If you  personally rent to your business you would have to claim the rent as rental income so it would be a wash.  Can't get around it.  

[rjs · Accepted solution]

As you correctly stated, you and your business are not separate entities. They are one and the same. You can't pay rent to yourself and claim it as a business expense. Paying rent to yourself is just taking money out of one pocket and putting it back in the same pocket. There is no real transaction.

The deduction for business use of your home is your only option. Why don't you want to use that?