Has anyone filed a tax return for two separate home businesses?

Question

I have two separate home businesses. Both are computer-based and I use the same home office. When you are filling out the home use and expenses part, do you fill out the same amounts, ie. your home utilities, computer purchases and expenses, for each home business?

Both businesses are sole-prop under my name, no tax id number. According to your answer, I would combine the incomes of both (I guess regardless that the businesses are different type businesses?)

Thanks for your answer!

Answer 1

You can file different Sch. C's for your two businesses. When claiming office space, equipment (such as computers, printers, etc.) you need to figure out the percentage of time used on each one. Just remember, if you use that computer less than 80% you can not claim it!! If you use the same numbers on each Sch. C, you will get flagged.
What would make your life easier, turn it all into one business. Many compaines file one Sch. C and have thier hands in many different ventures. That way, everything is combined, usage percentages, office space, everything, even income. Your bottom line number would not change. You would still have to pay Self Employment Tax on your combined business income whether it is one company or several.

Answer 2

Your answer depends upon the status of your legal entity with the IRS. Are these separate legal entities or not? Do they have a separate FET #? If they are just spearate business activities operating under your name [sole priorptorship] then you will file your regular 1040 with a schedule C to reflect the busiess activities. Be very, very, careful with the home business deduction this is a flag for the IRS. There many rules regarding home business deductions. If all of your business acitivity operates under your name [sole propertership] they are in effect a single business and your home business calcuations should reflect it. Sooo...........figure what legal entity(s) you have and that will tell you how to file.