Hi everybody...I know this is probably a very stupid question, but my brain is literally fried. New clients, not married (but RDP, so we get a whole host of issues next year) both have Schedule C businesses. Both have home offices. Home is rented. Do I put full amount of rent in 8829 for each, or only half? Like I said, I am one fried puppy. And one earned income in about 10 states last year, most of which have filing requirements if you earn ANYTHING in their states....
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Rdp?
sort of like, significant other? I don't have a clue.Originally posted by joanmcq View Post
certainly not full amount of rent, cause that would be double dipping. I would
lean toward allocating the square footage portion based on relative times spent by
each in the common home office.ChEAr$,
Harlan Lunsford, EA n LA -
Registered Domestic Partners. Considered married in CA now for tax purposes, starting with 2007. But they EACH have their own home office; so is it still double dipping? Would not be if filing joint...but they file as single for federal. These are real Sch C businesses; sole source of income for each.Comment
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Assuming each is paying 1/2 the rent, you'd use the 1/2 rent amount on each 8829.Originally posted by joanmcq View PostComment
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Are they using the same area in the home for an office?Originally posted by joanmcq View PostComment
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No, two completely separate offices. I keep thinking that next year, for the joint return, the full amount of rent paid by both will be used for the computation. So why not for the separate returns?
Have had much more coffee by now but still fried. Must eat something besides cereal.Comment
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8829 Question
I agree with Mopeo.
I have similar situation where both husband and wife live in an apartment and BOTH use the same room as an office (BOTH are self-employed, each independent of each other).
I prepare 2 separate 8829 forms, and use 50% for each of allocated portion of rent, utilities, insurance that pertain to the use of that room.Uncle Sam, CPA, EA. ARA, NTPI FellowComment
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Your clients are sharing a room, so you should be allocating the room based on space used. If they use the same area for two different businesses, you allocate based on time spent. So if the same space is being used by both each 50% of the time, you would allocate 50% each, or you would be double dipping. If they had two offices or split one room, you would do the allocation by the square footage computation. For example, a 250 square foot room being used half by one, half by the other. 125 sq. ft. on each 8829. If they are using the same sq footage (or most of it is so jointly used you can't allocate the space...like two computers with the same printer and storage space for office products etc, then you could split the expenses by half, although you could also allocate the space on the 8829 by time spent. If one person runs two businesses out of the same home office, you split by time spent on each business.Comment
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