Using your RE business to write off a home office in your taxes.

[Luke Holmes]

Hello everybody. I'm a new investor and I've recently become very interested in the small tax write offs that I can begin taking advantage of to refine my strategy on taxes. One such strategy can be claiming a home office. 10 or 20 years ago this was a red flag for the IRS, but times have changed and the IRS has even made public statements saying that they recognize the increase in home offices.

With April looming, what strategies do you use to qualify your real estate business for a home office (assuming you don't have another office)? Do you use a LLC or other legal entity and write the deduction off under it? How about presentation and documentation of the space? Is it its own room or is it just a desk in the hall?

Thank you!

[Michael Plaks]

@Luke Holmes

Sounds like you've been Grant Cardone-d. :)

Claiming home office is not "a strategy" at all. It is a legitimate deduction for a profitable business that uses a space in your home. Making a profit is step one. No profit = no home office deduction.