Office-in-Home Tax Deduction for Bath Reno?
Yes, I know you may not be an accountant, but this situation has probably come up for someone. My primary place of business is my home, and I deduct a percentage of my home as office space (a room’s worth). Last year, I re-did my bathroom. Can I deduct the same percentage, or any percentage…
Yes, I know you may not be an accountant, but this situation has probably come up for someone.
My primary place of business is my home, and I deduct a percentage of my home as office space (a room’s worth).
Last year, I re-did my bathroom. Can I deduct the same percentage, or any percentage of those costs as a business expense? Thanks!
I ran a business from my home during the 80s/90s, and my accountant never let me deduct any home renovations that weren’t specifically related to the business area. So, shelves, re-wiring and painting that room were acceptable, but a renovation of my bathroom wouldn’t be. I didn’t have a business where many clients came to my home, however; that might make a difference. But as many others here have said, either ask an accountant or call that anonymous IRS help line and ask them. (I’ve called with questions like this and found the people to be helpful.)
I really don’t want this come across as snarky but–why don’t you just ask your accountant? If you don’t have an accountant and you have your own business–especially with a home office–you really should. It will save you a tremendous amount of time and probably a lot of money, too.
In many cases the appropriate treatment is to add to the bathroom cost to the basis of the property, depreciate, and then home office portion of that annual depreciation flows through to your Form 8829.
In all cases the appropriate treatment really depends on the tax filing taken as a whole – for home office deductions I recommend using a professional.
Thanks CGfan. I will assume your reasoning prevails unless I hear otherwise.
The deduction isn’t about whether this is your “only” place of business — it’s about whether the area is used ONLY for business purposes and for nothing else. But I imagine the best advice to you would come from an accountant who does taxes for in-home businesses and not here. When I was working only out of my home, I was definitely advised by the accountant to be very careful of taking the home office deduction — I can’t imagine the reaction if I suggested deducting part of a bathroom renovation! Perhaps if you see clients in your home, and have a bathroom for their use only, it might be allowed. But not simply because you work out of your home and use the bathroom during that time.
Eventually the morons rush in.
I don’t know what “cost basis” means (other than when calculating profits and capital gains). FWIW, This is my only place of business; it’s not an additional “home office”; and I don’t plan to be scared into not taking a deduction for my office expenses (for the office); have until Thursday to answer this question…
Ridiculous.
I’d love to help pay for your bath renovation. I work at home sometimes as well and I make coffee in the kitchen for clients. I need a new Sub-Zero fridge to store the cream and one of those built-in Miele coffee machines. Sometimes a client asks for a hamburger and I’d like to cook one up on my eight burner Viking range.
signed
Dennis Kozlowski
Is the bathroom an extra powder room that you can justify as being used only for the business? If not, it’s going to raise a huge red flag with the IRS and will be very hard to defend when it triggers an audit. I have also been advised that deducting a portion of a bedroom that has a desk and office space is also improper — the space has to be used only for business. I’m not a tax lawyer, however.