Home Office General Comment

[tonya030]

I have seen several threads on the home office and who can deduct and who cannot. I have done considerable research to fairly reach some general conclusions regarding same.

First of all, if you read publ. regarding Home Office, it certainly is clear that the home office applies to individuals and partnerships. In this regard, an individual would be anyone filing a Sch C. or employee business expense.

The partnership is referenced in another publication and it in fact states that a partner can take miscellaneous deductions on Sch E. (if required or so stated by the partnership)

In any publication referencing rental property, there are no statements regarding the
use of home office.

To sum it up, individuals, filing 2106 or Sch C. can utilize 8829. Partner can utilize
8829. Rental property and 8829 is a no go, unless an individual can file Sch C.
then it would be allowed.

So now, somebody is going to ask who can file a schedule C for owning rental property.
I can only relate what the IRS says. Basically you can be considered a business if it is
for income and profit and is done with regularity.

Oh Well

Tonya030

[Bees Knees]

I disagree

The IRS is not God. The courts shoot down IRS logic all the time.

Read the court case cited on page 5-14 of TTB. The taxpayer worked 40 hours per week as an employee. He also owned six rental units. The IRS tried to throw out the office in home deduction on his Schedule E per reasons you stated. The court disagreed with IRS. Office in Home deductions were alowed. Nothing in that case indicates the court based its decision on whether the rental activity was a Schedule E or Schedule C activity. In fact, the court said the mere ownership and management of rental property (something every small landlord does) can be considered a trade or business for purposes of the office in home rules.

[outwest]

I agree with Bees...

just posted that response on another board.

Curphey v. Commissioner, 73 T.C. 766 (1980)

for those interested.

Doug

[taxea]

Home Office General Comment

I have long agreed with the court ruling and have used 8829 on Sch E for years with no problem.