I'm using Home & Business and it's giving me a home office expense carryover. It's only allowing a small portion of my calculated home office deduction. As far as I can tell, it should only be limited if the deduction causes a loss, but the business profit is orders of magnitude greater than the deduction. Any ideas?
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Your Home & Business expense is limited based on the percentage of business use. The deduction is based on a percentage based on the total area of your home and the area that is used for your business.
There are two methods to calculate your home office expenses, one is the simplified method and the other one is the regular method. Per the IRS tax tip, How small business owners can deduct their home office from their taxes:
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