What Qualifies as Regular Use for the Home-Office Deduction?

To deduct an office in the home, you must pass the regular-use test in addition to exclusive use.

The IRS audit manual states:¹

Regular use means that you use the exclusive business area on a continuing basis.  The occasional or incidental business use of an area in your home does not meet the regular use test even if that part of your home is used for no other purpose.

The IRS, in its proposed regulations, states that it makes its determination of regular use of the home office in light of all your facts and circumstances.²

How do you prove your regular use?

You can use two sets of information to prove regular use of your home office:

  1. A log of time spent (use your home office an average of 10 hours or more per week),  and
  2. Documents that corroborate the time spent.

Corroborative evidence can be:

  1. Keep the emails
  2. Have clients/vendors sign your guest log, and
  3. make phone calls on your home office telephone so that you have a billing statement that shows you made the calls from your home office at the times you stated in the log.

If you would like to learn more about this tax strategy, please call Susan at 847.895.9880.

¹Internal Revenue Manual Exhibit 4.10.10-3  – Standard Explanation Paragraph 4814 Test for Home Office (Last Revised: 01-11-2011).                          ² Prop. Reg. Section 1.280A-2(h).