DON’T FEAR LEGIT HOME-OFFICE DEDUCTIONS — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily


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Q: In a recent item, you stated that the IRS is cracking down on home-based businesses. Yet, your publication often touts deductions for home offices. Does this still make sense? A.L.T., Baltimore

A: Yes. The IRS listed a number of items on its “hit list” such as phony deductions for home-based businesses. Taxpayers often try to write off a portion of ordinary household expenses without any qualified business use. But, if you legitimately operate a business from home, you’re entitled to claim direct expenses as well as a portion of indirect household expenses (e.g., utilities). Tip: To qualify, you must use the office part of your home regularly and exclusively as either your principal place of business or a place to meet or deal with clients, customers or patients.

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