Each year the U.S. Census Bureau publishes what it refers to as nonemployer statistics that may provide information about the increased importance of the business use of taxpayers’ homes. A “nonemployer,” for purposes of the statistics, is defined as a business that has no paid employees, has annual business receipts of at least $1,000 and is subject to federal income taxes. These nonemployers may be organized as corporations, partnerships or sole proprietorships. Because they have no paid employees, nonemployers are more likely than others to operate their businesses from their homes and seek a home office tax deduction.
The data supplied on nonemployers shows a generally increasing number of these businesses, from a total of 19.5 million in 2004 to 23 million in 2013. In 2013 alone, the number of nonemployers increased by 300,000. Although they have no paid employees, they account for significant receipts. In 2004 they produced receipts of $887 billion; by 2013, those receipts had grown to $1.2 trillion, up $21.1 billion in 2013 alone. Clearly, the likelihood that any tax return preparer will be required to prepare a taxpayer’s tax return with a home office deduction is significant and is becoming more likely each year.
This course will examine the federal income tax deduction for business use of a home and will discuss:
- Qualifying for a home office tax deduction;
- Determining a taxpayer’s home office deduction using the actual expense and simplified methods;
- The special home-office deduction rules that apply to daycare facilities;
- The taxpayer’s home-office deduction recordkeeping requirements; and
- Where to take the deduction and the forms a tax preparer must use in connection with it.
3 Credit Hour .PDF Based Course