the company name should be written on the lease contract.
2007-08-05 17:56:04 · 5 answers · asked by dan 1 in Business & Finance ➔ Renting & Real Estate
Depends on zoning. A company can lease a residence AS a residence, but I don't believe they can lease a property zoned as a residence as commercial space.
2007-08-05 18:04:26 · answer #1 · answered by Piggiepants 7 · 1⤊ 0⤋
You'd have to take a look at the local zoning laws to determine whether it's legal.
In many cities, R-1 zoning allows certain "home occupancy" businesses, but depending on the rules, may not allow you to have employees, and you usually cannot engage in a business where customers come to your office.
If you were an architect, having a client visit 3 times a year would cause no problem, but if you have a UPS driving stopping daily, that *may* be enough to tip you over the edge.
As long as the office is regularly and exclusively used for a business, the IRS is happy with it. If you charge $1000 rent to the business, you have $1000 personal rental income to report on Schedule E, but you can deduct the heating, maintenance, mortgage, etc., pro-rata.
If the rent is at a fair "hands-off" price, and the rent is higher than the cost of related expenses, this has the effect of moving income off Schedule C, where income is subject to social security taxes, to Schedule E, where income is NOT subject to social security taxes.
If the home is owned by you and your wife, and the business is owned by someone else - say, you and your brother - setting a fair rent not only provides a tax benefit, but has a legitimate business purpose on its own. If both have the same ownership, you may be required to show a legitimate business purpose. In that case, you should be able to show that you need the financials to show the cost of rent, because you're planning a sale of the business, or planning to refinance the business.
2007-08-05 18:16:41 · answer #2 · answered by Anonymous · 0⤊ 0⤋
If the office is in a area zoned for offices anyone can rent one. A company would probably have a corporate officer sign the lease.
2007-08-05 18:02:31 · answer #3 · answered by shipwreck 7 · 0⤊ 0⤋
Yes. But if you are thinking about renting space in your own home to your own company, realize that you'd have to claim the rent as income so it would be a wash. What you'd do instead in that case is take a home office deduction if you qualify.
2007-08-05 18:03:39 · answer #4 · answered by Judy 7 · 0⤊ 0⤋
yes, and yes
2007-08-05 18:05:12 · answer #5 · answered by sophieb 7 · 0⤊ 0⤋