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You must use the home office exclusively and regularly for one or more of the following purposes. As the principal place of business for one or more of your trades or businesses. As a place to meet or deal with patients, clients, or customers in the normal course of one or more of your trades or businesses.
A portion of your home may qualify as your principal place of business if you use it for the administrative or management activities of your trade or business and have no other fixed location where you conduct substantial administrative or management activities for that trade or business.
The simplified method allows a standard deduction of $5 per square foot of home used for business, with a maximum of 300 square feet. Allowable home-related itemized deductions, such as mortgage interest and real estate taxes, are claimed in full on Schedule A.
You sell products at wholesale or retail as your trade or business. You keep the inventory or product samples in your home for use in your trade or business. Your home is the only fixed location of your trade or business. You use the storage space on a regular basis.
Regularly and Exclusively The inventory youre storing is what you sell as part of your business. You keep the inventory or product samples that you sell in your home. Your home (where you store the products) is the only fixed location of your business. You use the storage space on a regular basis for business.
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Taxpayers who qualify may choose one of two methods to calculate their home office expense deduction: The simplified option has a rate of $5 a square foot for business use of the home. The maximum size for this option is 300 square feet. The maximum deduction under this method is $1,500.
Form 8829, Expenses for Business Use of Your Home is the tax form that businesses use to itemize, calculate and claim their home office expenses. You file it at the same time you file your personal tax return, and report the deduction you calculate on it on line 30 of Schedule C of Form 1040.

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