the right answer is whatever method would most properly allocate expenses which really isn't an answer
Typically, you can divide the expenses for rental and personal use based on either:
- The square footage of the rental space versus that of your entire house (e.g., 250 square foot room rented / 2,500 square foot house = 10% of expenses are deductible).
- The number of rooms rented out versus the total number of rooms in your house (e.g., two rooms rented / 10 rooms in the house = 20% of expenses are deductible)
- for the following type of expenses
- Mortgage interest
- Repairs
- Improvements
- Homeowners insurance
- House cleaning or gardening services(?) the IRS may deem landscaping gardening as 100% personal
- Trash removal
- Snow removal
- Security system costs
- Depreciation
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certain other expenses may be more properly allocated based on the number of people in the home
like utilities
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in your situation with use of the basement that complicates matters. However, I think square feet, including the basement, is most appropriate.
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others may have a different opinion