Home Office Deduction on Schedule E

Forum|Forum|2 years ago
October 11, 2023
2 replies
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I do not have a schedule C. I owned couple properties and self-managed the properties: collect rent, repairs, maintenance, background check etc.

My understanding is home office is put under line 19 – under “Other Expenses” for schedule E per the Curphey vs Commissioner ruling and other research (CPA).

1) Does it matter if it’s under the traditional method (home office % of house), not the simplified method ($5 x sqft). Do I need to fill out any other forms?

2) Do I put all the home office expenses cost under 1 property or split 50/50?

3) Given I declare a qualifying home office (tax home), can I still include mileage expenses to the rentals (maintenance, etc..)

Anonymous_

Employee

I'm going to page @AmeliesUncle for this but, first of all, note that your rental activities must rise to the level of a trade or business and that's a tough argument to make with a "couple properties".

Regardless, you definitely would not file other forms, such as Form 8829 as that form is strictly to be filed with Schedule C.

AmeliesUncle

As Tagteam mentioned, you would first need to confirm that the rental activity rises to the level of a "business" and that the office is used "regularly and exclusively". Personally, I would think it would be unusual for a person with two rentals to meet those requirements.

But if you meet those requirements, in answer to your questions:

1) I think either method would be allowed.

2) Split between properties.

3) If your home is your "principal place of business", then the miles should be deductible.

buns2Author

Employee

Thank you @AmeliesUncle @Anonymous_

Since I am deducting the mortgage interest from my home office in Schedule, so I manually deduct the interest in Schedule A?

For example, say there is 10000 mortgage interest. 10% was for the home office, which equals 1000.

I put 1K in Schedule E, then 9K in Schedule A? Schedule A is picking up the full 10K mortgage interest based on the 1098 provided by the bank. Do I adjust it on the 1098 portion, or manually change it in schedule A? Do I need to click on something on the program? Thank you so much again.