Claim S-Corp Home Office Deduction and affect on Personal Taxes


I'm wondering what's the best way to capture the home office deduction for my s-corp which I run out of my house.

I've heard that the preferred method is having the S-Corp reimburse me for the proportional amount of utilities, mortgage, taxes, insurance, maintenance, etc and to list that as an Itemized Deduction for the S-Corp.

I'm wondering:

1) What sort of paperwork should I maintain for this method in-case of audit?
2) How do I adjust the mortage, interest, and property taxes on my personal tax return? (I am assuming that I can't double count it, however I'm hesitant to report something different than what's on my Form 1098, is this reported as income?)
    1. You should keep your mortgage bills (monthly and/or yearly statement for as long as you are claiming a home office. You should also keep your property tax bill, utility bills, insurance bills, and receipts for repairs and improvements made to the home for as long as you are claiming a home office. Dependent on how often the S corporation reimburses you, you should keep a journal of what is being reimbursed and how the reimbursement was computed  Form example, if you are reimbursed on a monthly basis, make copies of your monthly home office bills, and multiply the total by your home office percentage.

    2. I would reduce your mortgage and your property tax deductions by the amount the S corporation is deducting on its books. It would be "double dipping" on the same expenses if you reported your full amounts reported on your mortgage interest statement for the year, and what was shown as paid on your property tax bill.
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