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Should I report my detached garage as a home office asset or as a business asset?

Forum|Forum|6 years ago
June 6, 2019
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I have a 150 sq ft home office in my 3300 sq ft house. I built a 2000 sq ft detached garage for business use. I have depreciated the detached garage for 2 years as a business asset. Should I instead report that my home is 5300 sq ft and I have a 150 sq ft home office and a 2000 sq ft home office (2 assets on the home office page)?

TurboTax Home & Biz Windows

Best answer by KrisD15

Normally the storage space would be listed and treated as part of the home office. If the garage is listed as a business asset, it would not be included in the exclusion of capital gains on a personal residence if you were to sell.

If you do include it as a home office, you would combine the square footage and report as one office.

On the business side, sell it to yourself at cost and recapture the depreciation you have already taken on the business side. Add the cost to your home's adjusted basis if you sell and need to claim any capital gains.

KrisD15Answer

Normally the storage space would be listed and treated as part of the home office. If the garage is listed as a business asset, it would not be included in the exclusion of capital gains on a personal residence if you were to sell.

If you do include it as a home office, you would combine the square footage and report as one office.

On the business side, sell it to yourself at cost and recapture the depreciation you have already taken on the business side. Add the cost to your home's adjusted basis if you sell and need to claim any capital gains.

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