Home Office
Home Office means:
an office in the taxpayer's residence used exclusively for business on a regular and continuing basis. The office must be the taxpayer's principal place of business (i.e., where the majority of his or her work is performed) or serve as a place to meet customers or clients and, if the taxpayer is not self-employed, must be used for the convenience of his or her employer.
The Supreme Court has held that, when a particular business is conducted in more than one place, the principal place of business is where the most important function of the business is performed. The Court therefore denied a home office deduction for a physician who used his home office only for maintaining records and placing phone calls because the physician's function in treating patients in the hospital was more important. The taxpayer may claim a portion of utility expenses and a depreciation deduction for a qualifying home office and any furniture and equipment contained therein. Upon sale of the home, however, any gain attributable to the business portion cannot be deferred. Former IRC (check if this IRC provision is current here) §280A.
Home office expenses
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See Depreciation in the United States Encyclopedia of Law and Depreciation in the World Encyclopedia of Law.
If you use part of your home regularly and exclusively as the principal place of your business or the place you meet with clients, patients or customers, you can qualify to deduct certain expenses that are otherwise nondeductible personal expenses. Examples include a portion of your utilities, homeowner's insurance premiums and depreciation (if you own your home) or part of your rent (if you are a renter). See Tax Break for Telecommuters.
Description and Definition of Home Office
A part of your home or other structure on your property which qualifies you to take a deduction for its business use.
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