I read in The Tax Book, S- shareholder rents office space to corporation, not allowed to deduct expenses utilities etc and depreciation on office space. Am I reading it correct?
Bob
Bob
-
-
Home Office-Sub S Shareholder
You are reading it right.
However, if the business is organized as a corporation and is operated out of the home and the general home office tests are met, , the shareholder can use unreimbursed employee business expenses (Form 2106) or get reimbursed under an accountable plan.
As you noted, if the Corporation pays rent to the shareholder, the shareholder cannot claim a home office deduction and must report the rental income on Sch E without deductions (Reg 280A (c)(6).
Comment