Home Office Expenses deductible w/out depreciating?
ProSeries : 2011I have a client that wants to deduct home office expenses (proportionate utilities, etc), BUT doesn't want to depreciate the house. Is this allowable?
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IRMN
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02/07/12 5:02pm PST
Have you ever heard the phrase alllowed or allowable? You might as well take it since when the house is sold, the sale will still be required to be treated as if the depreciation was taken.
If this answers your question please click, um, ok I forgot what you are supposed to click. If this answered your question, how about just saying thanks and we will call it good.
Accountant Man
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02/07/12 5:07pm PST
You're the professional. You tell them the law, and if they don't want to follow the law, perhaps you should decline the engagement.
If you use Pro Series Basic I might not be able to help you. If you use Turbo Tax I might refuse to help you. All others, watch out! ;-)
peterhawaii
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02/07/12 5:18pm PST
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Yes, it is perfectly legal to deduct the home office expenses without the depreciation. Then when the house is sold the basis must be reduced by the allowed or allowable depreciation, even if no depreciation was taken when the taxpayer decided not to deduct the depreciation.
All you need to do is to inform the taxpayer of the allowed or allowable depreciation adjustment when the home is sold, and the taxpayer can now decide to not deduct the depreciation. When the hnome is sold the allowed or allowable depreciation mustd be used,
