Disallowance of form 5329 Office in Home

[dyne]

Yesterday I read in a book published in 1981 that if a husband and wife BOTH had a
schedule C business and BOTH use the SAME room for business use, NO deduction
at all is allowed for the office in home expense. It would fail the EXCLUSIVE use
for ONE business rule. I meant form 8829.

[Kram BergGold]

The moral is

Stop reading old books!

[dyne]

Yes, I meant form 8829. The book stated that an IRS Tax Auditor disallowed the office in home expense because the taxpayer admitted that both he and his wife used the room for their TWO separate businesses reported on schedule C,s. The rules do say that the room or office must be used EXCLUSIVELY for the business for which the deduction is claimed. The use by the wife of the office would not meet the EXCLUSIVE use rule. I thought this was interesting.

[Lion]

Area

The room does not have to have exclusive use; the office area does. So, if the two spouses each have their own areas and use only their corresponding square footage, you would have two qualified home offices. If they share the room, desk, computer, etc., then neither uses the area regularly and exclusively.

[JG EA]

The room does not have to have exclusive use; the office area does. So, if the two spouses each have their own areas and use only their corresponding square footage, you would have two qualified home offices. If they share the room, desk, computer, etc., then neither uses the area regularly and exclusively.

Notice though TTB

Author’s Comment: The fact that more than one business is using
the home office does not disqualify the home office under the exclusive
use test for another trade or business. In multiple business use
situations, the exclusive use test is applied by combining all trades or
businesses using the same home office. The exclusive use test fails if
one of the business activities using the home office fails under one of
the other tests.