if i own my own business and use part of my house for the office, can i make my company my monthly bills?

Question

i am the only worker in my business and sometimes i get my son to help and i pay him by company check and send w-2's at the end of the year. i am licensed by the state. and want to be legal about it it.

Answer 1

You need to consult a CPA.

Generally, the home office deduction allows you to deduct a portion of the expenses of the home (utilities, rent or mortgage) based on the percentage of the home that is used EXCLUSIVELY for business. For example, you have a 2000 square foot home, and use a 10 by 10 room for nothing else but your business, you can deduct five percent of everything.

However.

Claiming the Home Office Deduction MAY interfere with your being able to later exclude reporting of the proceeds of the sale of your home to the IRS. If your home doesn't qualify anyway as it is above the allowed limit, or you didn't live there long enough when sold, then that may not matter, but check before you shoot yourself in the foot.