Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Amended Tax Return Deadline

Irs State Tax Forms1040x Calculator1040 Tax Forms PrintableAmended 1040 Form2040 Ez FormTaxslayer For MilitaryWww.myfreetaxes.comHow Can I Amend My Tax ReturnIrs Forms 1040nrIncome Tax DeadlineFree Ohio Tax Form 1040ez2012 Federal Tax AmendmentHttps Mypay Dfas MilAmend 2011 TaxH&r Block Tax Cut 2011Free E File1040 Ez DownloadFree Tax Filing OnlineFree H&r BlockTax Form 1040x Amended ReturnDo State Taxes For FreeFree State File TurbotaxAmending 2010 Federal Tax ReturnFile Only State Taxes Online FreeHow Can I File My State Taxes For FreeTaxslayer 2011 Tax Return1040ez Tax Forms DownloadsFree Tax Filing 2013 Low IncomeState Tax Online Filing1040ez Form 2011Turbotax 2011 SoftwareH And R Block Free OnlineIrs E File Form 4868File Prior Year Taxes OnlineH& R BlockTax Form 1040ezFile Tax Return For 2011Free Federal State Tax FilingHow To Do Your TaxesFiling Taxes For Military

Amended Tax Return Deadline

Amended tax return deadline Index A Adjusted basis: Adoption tax benefits, Adoption Tax Benefits Assessment for local improvements, Assessments for Local Improvements Canceled debt, Canceled Debt Excluded From Income Casualty and theft losses, Casualties and Thefts Credit for qualified electric vehicles, Vehicle Credits Decreases to, Decreases to Basis Depreciation, Depreciation Easements, Easements Employer-provided child care, Employer-Provided Child Care Example, Adjustments to Basis Example Gain from sale of home, Postponed Gain From Sale of Home Gas-guzzler tax, Gas-Guzzler Tax Increases to, Increases to Basis Section 179 deduction, Section 179 Deduction Subsidies for energy conservation, Exclusion of Subsidies for Energy Conservation Measures Adoption tax benefits, Adoption Tax Benefits Allocating basis, Allocating the Basis Assistance (see Tax help) Assumption of mortgage, Assumption of mortgage. Amended tax return deadline B Business acquired, Trade or Business Acquired Business assets, Business Assets Businesses exchanged, Exchange of business property. Amended tax return deadline C Canceled debt, Canceled Debt Excluded From Income Casualty and theft losses, Casualties and Thefts Change to business use, Property Changed to Business or Rental Use Community property, Community Property Constructing assets, Constructing assets. Amended tax return deadline Copyrights, Copyrights. Amended tax return deadline Cost basis: Allocating basis, Allocating the Basis Assumption of mortgage, Assumption of mortgage. Amended tax return deadline Capitalized costs, Activities subject to the rules. Amended tax return deadline , Deducting vs. Amended tax return deadline Capitalizing Costs Loans, low or no interest, Loans with low or no interest. Amended tax return deadline Real estate taxes, Real estate taxes. Amended tax return deadline Real property, Real Property Settlement costs (fees), Settlement costs. Amended tax return deadline D Decreases to basis, Decreases to Basis Demolition of building, Demolition of building. Amended tax return deadline Depreciation, Depreciation E Easements, Easements Employer-provided child care, Employer-Provided Child Care Exchanges: Involuntary, Involuntary Conversions Like-kind, Like-Kind Exchanges Nontaxable, Nontaxable Exchanges Partial business use of property, Partial Business Use of Property Taxable, Taxable Exchanges F Fair market value, Fair market value (FMV). Amended tax return deadline Franchises, Franchises, trademarks, and trade names. Amended tax return deadline Free tax services, How To Get Tax Help G Gain from sale of home, Postponed Gain From Sale of Home Gifts, property received, Property Received as a Gift Group of assets acquired, Group of Assets Acquired H Help (see Tax help) I Inherited property, Inherited Property Intangible assets, Intangible Assets Involuntary exchanges, Involuntary Conversions L Land and buildings, Land and Buildings Loans, low or no interest, Loans with low or no interest. Amended tax return deadline M More information (see Tax help) N Nontaxable exchanges: Like-kind, Like-Kind Exchanges Partial, Partially Nontaxable Exchange P Partially nontaxable exchanges, Partially Nontaxable Exchange Patents, Patents. Amended tax return deadline Points, Points. Amended tax return deadline Property changed to business use, Property Changed to Business or Rental Use Property received as a gift, Property Received as a Gift Property received for services: Bargain purchases, Bargain Purchases Fair market value, Property Received for Services Restricted property, Restricted Property Property transferred from a spouse, Property Transferred From a Spouse Publications (see Tax help) R Real estate taxes, Real estate taxes. Amended tax return deadline Real property, Real Property S Settlement costs (fees), Settlement costs. Amended tax return deadline Special-use valuation, Special-use valuation. Amended tax return deadline Spouse, property transferred from, Property Transferred From a Spouse Stocks and bonds, Stocks and Bonds Subdivided lots, Subdivided lots. Amended tax return deadline T Tax help, How To Get Tax Help Taxable exchanges, Taxable Exchanges Taxpayer Advocate, Contacting your Taxpayer Advocate. Amended tax return deadline Trade or business acquired, Trade or Business Acquired Trademarks and trade  names, Franchises, trademarks, and trade names. Amended tax return deadline Trading property (see Exchanges), Taxable Exchanges TTY/TDD information, How To Get Tax Help U Uniform capitalization rules: Activities subject to the rules, Activities subject to the rules. Amended tax return deadline Exceptions, Exceptions. Amended tax return deadline Prev  Up     Home   More Online Publications

Topic 602 - Child and Dependent Care Credit

You may be able to claim the child and dependent care credit if you paid work-related expenses for the care of a qualifying individual. The credit is generally a percentage of the amount of work-related expenses you paid to a care provider for the care of a qualifying individual. The percentage depends on your adjusted gross income. Work-related expenses qualifying for the credit are those paid for the care of a qualifying individual to enable you to work or actively look for work.

Expenses are paid for the care of a qualifying individual if the primary function is to assure the individual's well-being and protection. In general, amounts paid for services outside your household qualify for the credit if the care is provided for (i) a qualifying individual who is your qualifying child under age 13 or (ii) a qualifying individual who regularly spends at least 8 hours each day in your household.

The total expenses that may be used to calculate the credit are capped at $3,000 (for one qualifying individual) or at $6,000 (for two or more qualifying individuals). The dollar limits may differ depending on the tax year in question. The expenses qualifying for the computation of the credit must be reduced by the amount of any dependent care benefits provided by your employer that you exclude from gross income. In general, you can exclude up to $5,000 for dependent care benefits received from your employer. Also, generally, the expenses claimed may not exceed the lesser of your earned income or your spouse’s earned income. A special rule applies if your spouse is a full-time student or incapable of self-care. For additional information, refer to Publication 503, Child and Dependent Care Expenses.

For purposes of the child and dependent care credit, a qualifying individual is:

  1. Your dependent qualifying child who is under age 13 when the care is provided,
  2. Your spouse who is physically or mentally incapable of self-care and who has the same principal place of abode as you for more than half of the year, or
  3. Your dependent who is physically or mentally incapable of self-care, and who has the same principal place of abode as you for more than half of the year. For this purpose, whether an individual is your dependent is determined without regard to the individual's gross income, whether the individual files a joint return, or whether you are a dependent of another taxpayer.

An individual is physically or mentally incapable of self-care if, as a result of a physical or mental defect, the individual is incapable of caring for his or her hygiene or nutritional needs, or requires the full-time attention of another person for the individual's own safety or the safety of others.

For more information on who is a dependent or a qualifying child, refer to Publication 501, Exemptions, Standard Deduction, and Filing Information.

A noncustodial parent may not treat a child as a qualifying individual for purposes of the credit, even if the noncustodial parent may claim an exemption for the child. For more information on divorced or separated parents or parents who live apart at all times during the last six months of the year, refer to the topic Child of Divorced or Separated Parents or Parents Living Apart in Publication 503, Child and Dependent Care Expenses.

If a person is a qualifying individual for only a part of the tax year, only those expenses paid during that part of the year are included in calculating the credit.

In addition to paying for the care of a qualifying individual, you must meet all of the following conditions to claim the credit:

  1. Your payment must be made to a care provider who is not your spouse, the parent of your child who is your qualifying individual, your child under age 19, or a dependent of you or your spouse.
  2. You must file a joint return if you are married.
  3. You must provide the taxpayer identification number (usually the social security number) of each qualifying individual on the return on which you claim the credit.
  4. You must report the name, address, and taxpayer identification number (either the social security number, or the employer identification number) of the care provider on your return. If the care provider is a tax-exempt organization, you need only report the name and address on your return. You can use Form W-10 (PDF), Dependent Care Provider's Identification and Certification, to request this information from the care provider. If you do not provide information regarding the care provider, you may still be eligible for the credit if you can show that you exercised due diligence in attempting to provide the required information.

If you qualify for the credit, complete Form 2441 (PDF) and Form 1040 (PDF) or Form 1040A (PDF). If you received dependent care benefits from your employer (this amount should be shown on your Form W-2 (PDF), you must complete Part III of Form 2441. You cannot claim the child and dependent care credit if you use Form 1040EZ (PDF).

If you pay a provider to care for your dependent or spouse in your home, you may be a household employer. If you are a household employer, you may have to withhold and pay social security and Medicare taxes and pay federal unemployment tax. For more information, refer to Publication 926, Household Employer's Tax Guide, or Topic 756.

Page Last Reviewed or Updated: December 12, 2013

The Amended Tax Return Deadline

Amended tax return deadline Publication 587 - Main Content Table of Contents Qualifying for a DeductionExclusive Use Regular Use Trade or Business Use Principal Place of Business Place To Meet Patients, Clients, or Customers Separate Structure Figuring the DeductionUsing Actual Expenses Using the Simplified Method Daycare Facility Standard meal and snack rates. Amended tax return deadline Sale or Exchange of Your HomeGain on Sale Depreciation Basis Adjustment Reporting the Sale More Information Business Furniture and EquipmentListed Property Property Bought for Business Use Personal Property Converted to Business Use Recordkeeping Where To DeductSelf-Employed Persons Employees Partners How To Get Tax HelpLow Income Taxpayer Clinics Worksheet To Figure the Deduction for Business Use of Your HomeInstructions for the Worksheet Worksheets To Figure the Deduction for Business Use of Your Home (Simplified Method) Instructions for the Simplified Method Worksheet Instructions for the Daycare Facility Worksheet Instructions for the Area Adjustment Worksheet Qualifying for a Deduction Generally, you cannot deduct items related to your home, such as mortgage interest, real estate taxes, utilities, maintenance, rent, depreciation, or property insurance, as business expenses. Amended tax return deadline However, you may be able to deduct expenses related to the business use of part of your home if you meet specific requirements. Amended tax return deadline Even then, the deductible amount of these types of expenses may be limited. Amended tax return deadline Use this section and Figure A, later, to decide if you can deduct expenses for the business use of your home. Amended tax return deadline To qualify to deduct expenses for business use of your home, you must use part of your home: Exclusively and regularly as your principal place of business (defined later), Exclusively and regularly as a place where you meet or deal with patients, clients, or customers in the normal course of your trade or business, In the case of a separate structure which is not attached to your home, in connection with your trade or business, On a regular basis for certain storage use (see Storage of inventory or product samples , later), For rental use (see Publication 527), or As a daycare facility (see Daycare Facility , later). Amended tax return deadline Additional tests for employee use. Amended tax return deadline   If you are an employee and you use a part of your home for business, you may qualify for a deduction for its business use. Amended tax return deadline You must meet the tests discussed earlier plus: Your business use must be for the convenience of your employer, and You must not rent any part of your home to your employer and use the rented portion to perform services as an employee for that employer. Amended tax return deadline If the use of the home office is merely appropriate and helpful, you cannot deduct expenses for the business use of your home. Amended tax return deadline Exclusive Use To qualify under the exclusive use test, you must use a specific area of your home only for your trade or business. Amended tax return deadline The area used for business can be a room or other separately identifiable space. Amended tax return deadline The space does not need to be marked off by a permanent partition. Amended tax return deadline You do not meet the requirements of the exclusive use test if you use the area in question both for business and for personal purposes. Amended tax return deadline Example. Amended tax return deadline You are an attorney and use a den in your home to write legal briefs and prepare clients' tax returns. Amended tax return deadline Your family also uses the den for recreation. Amended tax return deadline The den is not used exclusively in your trade or business, so you cannot claim a deduction for the business use of the den. Amended tax return deadline Exceptions to Exclusive Use You do not have to meet the exclusive use test if either of the following applies. Amended tax return deadline You use part of your home for the storage of inventory or product samples (discussed next). Amended tax return deadline You use part of your home as a daycare facility, discussed later under Daycare Facility . Amended tax return deadline Note. Amended tax return deadline With the exception of these two uses, any portion of the home used for business purposes must meet the exclusive use test. Amended tax return deadline Storage of inventory or product samples. Amended tax return deadline    If you use part of your home for storage of inventory or product samples, you can deduct expenses for the business use of your home without meeting the exclusive use test. Amended tax return deadline However, you must meet all the following tests. Amended tax return deadline You sell products at wholesale or retail as your trade or business. Amended tax return deadline You keep the inventory or product samples in your home for use in your trade or business. Amended tax return deadline Your home is the only fixed location of your trade or business. Amended tax return deadline You use the storage space on a regular basis. Amended tax return deadline The space you use is a separately identifiable space suitable for storage. Amended tax return deadline Example. Amended tax return deadline Your home is the only fixed location of your business of selling mechanics' tools at retail. Amended tax return deadline You regularly use half of your basement for storage of inventory and product samples. Amended tax return deadline You sometimes use the area for personal purposes. Amended tax return deadline The expenses for the storage space are deductible even though you do not use this part of your basement exclusively for business. Amended tax return deadline Regular Use To qualify under the regular use test, you must use a specific area of your home for business on a regular basis. Amended tax return deadline Incidental or occasional business use is not regular use. Amended tax return deadline You must consider all facts and circumstances in determining whether your use is on a regular basis. Amended tax return deadline Trade or Business Use To qualify under the trade-or-business-use test, you must use part of your home in connection with a trade or business. Amended tax return deadline If you use your home for a profit-seeking activity that is not a trade or business, you cannot take a deduction for its business use. Amended tax return deadline Example. Amended tax return deadline You use part of your home exclusively and regularly to read financial periodicals and reports, clip bond coupons, and carry out similar activities related to your own investments. Amended tax return deadline You do not make investments as a broker or dealer. Amended tax return deadline So, your activities are not part of a trade or business and you cannot take a deduction for the business use of your home. Amended tax return deadline Principal Place of Business You can have more than one business location, including your home, for a single trade or business. Amended tax return deadline To qualify to deduct the expenses for the business use of your home under the principal place of business test, your home must be your principal place of business for that trade or business. Amended tax return deadline To determine whether your home is your principal place of business, you must consider: The relative importance of the activities performed at each place where you conduct business, and The amount of time spent at each place where you conduct business. Amended tax return deadline Your home office will qualify as your principal place of business if you meet the following requirements. Amended tax return deadline You use it exclusively and regularly for administrative or management activities of your trade or business. Amended tax return deadline You have no other fixed location where you conduct substantial administrative or management activities of your trade or business. Amended tax return deadline If, after considering your business locations, your home cannot be identified as your principal place of business, you cannot deduct home office expenses. Amended tax return deadline However, see the later discussions under Place To Meet Patients, Clients, or Customers and Separate Structure for other ways to qualify to deduct home office expenses. Amended tax return deadline Administrative or management activities. Amended tax return deadline   There are many activities that are administrative or managerial in nature. Amended tax return deadline The following are a few examples. Amended tax return deadline Billing customers, clients, or patients. Amended tax return deadline Keeping books and records. Amended tax return deadline Ordering supplies. Amended tax return deadline Setting up appointments. Amended tax return deadline Forwarding orders or writing reports. Amended tax return deadline Administrative or management activities performed at other locations. Amended tax return deadline   The following activities performed by you or others will not disqualify your home office from being your principal place of business. Amended tax return deadline You have others conduct your administrative or management activities at locations other than your home. Amended tax return deadline (For example, another company does your billing from its place of business. Amended tax return deadline ) You conduct administrative or management activities at places that are not fixed locations of your business, such as in a car or a hotel room. Amended tax return deadline You occasionally conduct minimal administrative or management activities at a fixed location outside your home. Amended tax return deadline You conduct substantial nonadministrative or nonmanagement business activities at a fixed location outside your home. Amended tax return deadline (For example, you meet with or provide services to customers, clients, or patients at a fixed location of the business outside your home. Amended tax return deadline ) You have suitable space to conduct administrative or management activities outside your home, but choose to use your home office for those activities instead. Amended tax return deadline Please click here for the text description of the image. Amended tax return deadline Can you deduct business use of the home expenses? Example 1. Amended tax return deadline John is a self-employed plumber. Amended tax return deadline Most of John's time is spent at customers' homes and offices installing and repairing plumbing. Amended tax return deadline He has a small office in his home that he uses exclusively and regularly for the administrative or management activities of his business, such as phoning customers, ordering supplies, and keeping his books. Amended tax return deadline John writes up estimates and records of work completed at his customers' premises. Amended tax return deadline He does not conduct any substantial administrative or management activities at any fixed location other than his home office. Amended tax return deadline John does not do his own billing. Amended tax return deadline He uses a local bookkeeping service to bill his customers. Amended tax return deadline John's home office qualifies as his principal place of business for deducting expenses for its use. Amended tax return deadline He uses the home office for the administrative or managerial activities of his plumbing business and he has no other fixed location where he conducts these administrative or managerial activities. Amended tax return deadline His choice to have his billing done by another company does not disqualify his home office from being his principal place of business. Amended tax return deadline He meets all the qualifications, including principal place of business, so he can deduct expenses (subject to certain limitations, explained later) for the business use of his home. Amended tax return deadline Example 2. Amended tax return deadline Pamela is a self-employed sales representative for several different product lines. Amended tax return deadline She has an office in her home that she uses exclusively and regularly to set up appointments and write up orders and other reports for the companies whose products she sells. Amended tax return deadline She occasionally writes up orders and sets up appointments from her hotel room when she is away on business overnight. Amended tax return deadline Pamela's business is selling products to customers at various locations throughout her territory. Amended tax return deadline To make these sales, she regularly visits customers to explain the available products and take orders. Amended tax return deadline Pamela's home office qualifies as her principal place of business for deducting expenses for its use. Amended tax return deadline She conducts administrative or management activities there and she has no other fixed location where she conducts substantial administrative or management activities. Amended tax return deadline The fact that she conducts some administrative or management activities in her hotel room (not a fixed location) does not disqualify her home office from being her principal place of business. Amended tax return deadline She meets all the qualifications, including principal place of business, so she can deduct expenses (subject to certain limitations, explained later) for the business use of her home. Amended tax return deadline Example 3. Amended tax return deadline Paul is a self-employed anesthesiologist. Amended tax return deadline He spends the majority of his time administering anesthesia and postoperative care in three local hospitals. Amended tax return deadline One of the hospitals provides him with a small shared office where he could conduct administrative or management activities. Amended tax return deadline Paul very rarely uses the office the hospital provides. Amended tax return deadline He uses a room in his home that he has converted to an office. Amended tax return deadline He uses this room exclusively and regularly to conduct all the following activities. Amended tax return deadline Contacting patients, surgeons, and hospitals regarding scheduling. Amended tax return deadline Preparing for treatments and presentations. Amended tax return deadline Maintaining billing records and patient logs. Amended tax return deadline Satisfying continuing medical education requirements. Amended tax return deadline Reading medical journals and books. Amended tax return deadline Paul's home office qualifies as his principal place of business for deducting expenses for its use. Amended tax return deadline He conducts administrative or management activities for his business as an anesthesiologist there and he has no other fixed location where he conducts substantial administrative or management activities for this business. Amended tax return deadline His choice to use his home office instead of the one provided by the hospital does not disqualify his home office from being his principal place of business. Amended tax return deadline His performance of substantial nonadministrative or nonmanagement activities at fixed locations outside his home also does not disqualify his home office from being his principal place of business. Amended tax return deadline He meets all the qualifications, including principal place of business, so he can deduct expenses (subject to certain limitations, explained later) for the business use of his home. Amended tax return deadline Example 4. Amended tax return deadline Kathleen is employed as a teacher. Amended tax return deadline She is required to teach and meet with students at the school and to grade papers and tests. Amended tax return deadline The school provides her with a small office where she can work on her lesson plans, grade papers and tests, and meet with parents and students. Amended tax return deadline The school does not require her to work at home. Amended tax return deadline Kathleen prefers to use the office she has set up in her home and does not use the one provided by the school. Amended tax return deadline She uses this home office exclusively and regularly for the administrative duties of her teaching job. Amended tax return deadline Kathleen must meet the convenience-of-the-employer test, even if her home qualifies as her principal place of business for deducting expenses for its use. Amended tax return deadline Her employer provides her with an office and does not require her to work at home, so she does not meet the convenience-of-the-employer test and cannot claim a deduction for the business use of her home. Amended tax return deadline More Than One Trade or Business The same home office can be the principal place of business for two or more separate business activities. Amended tax return deadline Whether your home office is the principal place of business for more than one business activity must be determined separately for each of your trade or business activities. Amended tax return deadline You must use the home office exclusively and regularly for one or more of the following purposes. Amended tax return deadline As the principal place of business for one or more of your trades or businesses. Amended tax return deadline 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. Amended tax return deadline If your home office is a separate structure, in connection with one or more of your trades or businesses. Amended tax return deadline You can use your home office for more than one business activity, but you cannot use it for any nonbusiness (i. Amended tax return deadline e. Amended tax return deadline , personal) activities. Amended tax return deadline If you are an employee, any use of the home office in connection with your employment must be for the convenience of your employer. Amended tax return deadline See Rental to employer , later, if you rent part of your home to your employer. Amended tax return deadline Example. Amended tax return deadline Tracy White is employed as a teacher. Amended tax return deadline Her principal place of work is the school, which provides her office space to do her school work. Amended tax return deadline She also has a mail order jewelry business. Amended tax return deadline All her work in the jewelry business is done in her home office and the office is used exclusively for that business. Amended tax return deadline If she meets all the other tests, she can deduct expenses for the business use of her home for the jewelry business. Amended tax return deadline If Tracy also uses the office for work related to her teaching, she must meet the exclusive use test for both businesses to qualify for the deduction. Amended tax return deadline As an employee, Tracy must also meet the convenience-of-the-employer test to qualify for the deduction. Amended tax return deadline She does not meet this test for her work as a teacher, so she cannot claim a deduction for the business use of her home for either activity. Amended tax return deadline Place To Meet Patients, Clients, or Customers If you meet or deal with patients, clients, or customers in your home in the normal course of your business, even though you also carry on business at another location, you can deduct your expenses for the part of your home used exclusively and regularly for business if you meet both the following tests. Amended tax return deadline You physically meet with patients, clients, or customers on your premises. Amended tax return deadline Their use of your home is substantial and integral to the conduct of your business. Amended tax return deadline Doctors, dentists, attorneys, and other professionals who maintain offices in their homes generally will meet this requirement. Amended tax return deadline Using your home for occasional meetings and telephone calls will not qualify you to deduct expenses for the business use of your home. Amended tax return deadline The part of your home you use exclusively and regularly to meet patients, clients, or customers does not have to be your principal place of business. Amended tax return deadline Example. Amended tax return deadline June Quill, a self-employed attorney, works 3 days a week in her city office. Amended tax return deadline She works 2 days a week in her home office used only for business. Amended tax return deadline She regularly meets clients there. Amended tax return deadline Her home office qualifies for a business deduction because she meets clients there in the normal course of her business. Amended tax return deadline Separate Structure You can deduct expenses for a separate free-standing structure, such as a studio, workshop, garage, or barn, if you use it exclusively and regularly for your business. Amended tax return deadline The structure does not have to be your principal place of business or a place where you meet patients, clients, or customers. Amended tax return deadline Example. Amended tax return deadline John Berry operates a floral shop in town. Amended tax return deadline He grows the plants for his shop in a greenhouse behind his home. Amended tax return deadline He uses the greenhouse exclusively and regularly in his business, so he can deduct the expenses for its use, subject to certain limitations, explained later. Amended tax return deadline Figuring the Deduction After you determine that you meet the tests under Qualifying for a Deduction , you can begin to figure how much you can deduct. Amended tax return deadline When figuring the amount you can deduct for the business use of your home, you will use either your actual expenses or a simplified method. Amended tax return deadline Electing to use the simplified method. Amended tax return deadline   The simplified method is an alternative to the calculation, allocation, and substantiation of actual expenses. Amended tax return deadline You choose whether or not to figure your deduction using the simplified method each taxable year. Amended tax return deadline See Using the Simplified Method , later. Amended tax return deadline Rental to employer. Amended tax return deadline   If you rent part of your home to your employer and you use the rented part in performing services for your employer as an employee, your deduction for the business use of your home is limited. Amended tax return deadline You can deduct mortgage interest, qualified mortgage insurance premiums, real estate taxes, and personal casualty losses for the rented part, subject to any limitations. Amended tax return deadline However, you cannot deduct otherwise allowable trade or business expenses, business casualty losses, or depreciation related to the use of your home (or use the simplified method as an alternative to deducting these actual expenses) in performing services for your employer. Amended tax return deadline Using Actual Expenses If you do not or cannot elect to use the simplified method for a home, you will figure your deduction for that home using your actual expenses. Amended tax return deadline You will also need to figure the percentage of your home used for business and the limit on the deduction. Amended tax return deadline If you are an employee or a partner, or you use your home in your farming business and you file Schedule F (Form 1040), you can use the Worksheet To Figure the Deduction for Business Use of Your Home, near the end of this publication, to help you figure your deduction. Amended tax return deadline If you use your home in a trade or business and you file Schedule C (Form 1040), you will use Form 8829 to figure your deduction. Amended tax return deadline Part-year use. Amended tax return deadline   You cannot deduct expenses for the business use of your home incurred during any part of the year you did not use your home for business purposes. Amended tax return deadline For example, if you begin using part of your home for business on July 1, and you meet all the tests from that date until the end of the year, consider only your expenses for the last half of the year in figuring your allowable deduction. Amended tax return deadline Expenses related to tax-exempt income. Amended tax return deadline   Generally, you cannot deduct expenses that are related to tax-exempt allowances. Amended tax return deadline However, if you receive a tax-exempt parsonage allowance or a tax-exempt military allowance, your expenses for mortgage interest and real estate taxes are deductible under the normal rules. Amended tax return deadline No deduction is allowed for other expenses related to the tax-exempt allowance. Amended tax return deadline   If your housing is provided free of charge and the value of the housing is tax exempt, you cannot deduct the rental value of any portion of the housing. Amended tax return deadline Actual Expenses You must divide the expenses of operating your home between personal and business use. Amended tax return deadline The part of a home operating expense you can use to figure your deduction depends on both of the following. Amended tax return deadline Whether the expense is direct, indirect, or unrelated. Amended tax return deadline The percentage of your home used for business. Amended tax return deadline Table 1, next, describes the types of expenses you may have and the extent to which they are deductible. Amended tax return deadline Table 1. Amended tax return deadline Types of Expenses  Expense  Description  Deductibility Direct Expenses only for  the business part  of your home. Amended tax return deadline Deductible in full. Amended tax return deadline *   Examples:  Painting or repairs  only in the area  used for business. Amended tax return deadline Exception: May be only partially  deductible in a daycare facility. Amended tax return deadline See Daycare Facility , later. Amended tax return deadline Indirect Expenses for  keeping up and running your  entire home. Amended tax return deadline Deductible based on the percentage of your home used for business. Amended tax return deadline *   Examples:  Insurance, utilities, and  general repairs. Amended tax return deadline   Unrelated Expenses only for  the parts of your  home not used  for business. Amended tax return deadline Not deductible. Amended tax return deadline   Examples:  Lawn care or painting  a room not used  for business. Amended tax return deadline   *Subject to the deduction limit, discussed later. Amended tax return deadline Form 8829 and the Worksheet To Figure the Deduction for Business Use of Your Home have separate columns for direct and indirect expenses. Amended tax return deadline Certain expenses are deductible whether or not you use your home for business. Amended tax return deadline If you qualify to deduct business use of the home expenses, use the business percentage of these expenses to figure your total business use of the home deduction. Amended tax return deadline These expenses include the following. Amended tax return deadline Real estate taxes. Amended tax return deadline Qualified mortgage insurance premiums. Amended tax return deadline Deductible mortgage interest. Amended tax return deadline Casualty losses. Amended tax return deadline Other expenses are deductible only if you use your home for business. Amended tax return deadline You can use the business percentage of these expenses to figure your total business use of the home deduction. Amended tax return deadline These expenses generally include (but are not limited to) the following. Amended tax return deadline Depreciation (covered under Depreciating Your Home , later). Amended tax return deadline Insurance. Amended tax return deadline Rent paid for the use of property you do not own but use in your trade or business. Amended tax return deadline Repairs. Amended tax return deadline Security system. Amended tax return deadline Utilities and services. Amended tax return deadline Real estate taxes. Amended tax return deadline   To figure the business part of your real estate taxes, multiply the real estate taxes paid by the percentage of your home used for business. Amended tax return deadline   For more information on the deduction for real estate taxes, see Publication 530, Tax Information for Homeowners. Amended tax return deadline Deductible mortgage interest. Amended tax return deadline   To figure the business part of your deductible mortgage interest, multiply this interest by the percentage of your home used for business. Amended tax return deadline You can include interest on a second mortgage in this computation. Amended tax return deadline If your total mortgage debt is more than $1,000,000 or your home equity debt is more than $100,000, your deduction may be limited. Amended tax return deadline For more information on what interest is deductible, see Publication 936, Home Mortgage Interest Deduction. Amended tax return deadline Qualified mortgage insurance premiums. Amended tax return deadline   To figure the business part of your qualified mortgage insurance premiums, multiply the premiums by the percentage of your home used for business. Amended tax return deadline You can include premiums for insurance on a second mortgage in this computation. Amended tax return deadline If your adjusted gross income is more than $100,000 ($50,000 if your filing status is married filing separately), your deduction may be limited. Amended tax return deadline For more information, see Publication 936, and Line 13 in the Instructions for Schedule A (Form 1040). Amended tax return deadline Casualty losses. Amended tax return deadline    If you have a casualty loss on your home that you use for business, treat the casualty loss as a direct expense, an indirect expense, or an unrelated expense, depending on the property affected. Amended tax return deadline A direct expense is the loss on the portion of the property you use only in your business. Amended tax return deadline Use the entire loss to figure the business use of the home deduction. Amended tax return deadline An indirect expense is the loss on property you use for both business and personal purposes. Amended tax return deadline Use only the business portion to figure the deduction. Amended tax return deadline An unrelated expense is the loss on property you do not use in your business. Amended tax return deadline Do not use any of the loss to figure the deduction. Amended tax return deadline Example. Amended tax return deadline You meet the rules to take a deduction for an office in your home that is 10% of the total area of your house. Amended tax return deadline A storm damages your roof. Amended tax return deadline This is an indirect expense as the roof is part of the whole house and is considered to be used both for business and personal purposes. Amended tax return deadline You would complete Form 4684, Casualties and Thefts, to report your loss. Amended tax return deadline You complete both section A (Personal Use Property) and section B (Business and Income-Producing Property) as your home is used both for business and personal purposes. Amended tax return deadline Since you use 90% of your home for personal purposes, use 90% of the cost or adjusted basis of your home, insurance or other reimbursement, and fair market value, both before and after the storm, to figure the amounts to enter on lines 2, 3, 5, and 6 of Form 4684. Amended tax return deadline Since you use 10% of your home for business purposes, use 10% of the cost or adjusted basis of your home, insurance or other reimbursement, and fair market value, both before and after the storm, to figure the amounts to enter on lines 20, 21, 23, and 24 of Form 4684. Amended tax return deadline Forms and worksheets to use. Amended tax return deadline   If you are filing Schedule C (Form 1040), get Form 8829 and follow the instructions for casualty losses. Amended tax return deadline If you are an employee or a partner, or you file Schedule F (Form 1040), use the Worksheet To Figure the Deduction for Business Use of Your Home, near the end of this publication. Amended tax return deadline You will also need to get Form 4684. Amended tax return deadline More information. Amended tax return deadline   For more information on casualty losses, see Publication 547, Casualties, Disasters, and Thefts. Amended tax return deadline Insurance. Amended tax return deadline   You can deduct the cost of insurance that covers the business part of your home. Amended tax return deadline However, if your insurance premium gives you coverage for a period that extends past the end of your tax year, you can deduct only the business percentage of the part of the premium that gives you coverage for your tax year. Amended tax return deadline You can deduct the business percentage of the part that applies to the following year in that year. Amended tax return deadline Rent. Amended tax return deadline   If you rent the home you occupy and meet the requirements for business use of the home, you can deduct part of the rent you pay. Amended tax return deadline To figure your deduction, multiply your rent payments by the percentage of your home used for business. Amended tax return deadline   If you own your home, you cannot deduct the fair rental value of your home. Amended tax return deadline However, see Depreciating Your Home , later. Amended tax return deadline Repairs. Amended tax return deadline   The cost of repairs that relate to your business, including labor (other than your own labor), is a deductible expense. Amended tax return deadline For example, a furnace repair benefits the entire home. Amended tax return deadline If you use 10% of your home for business, you can deduct 10% of the cost of the furnace repair. Amended tax return deadline   Repairs keep your home in good working order over its useful life. Amended tax return deadline Examples of common repairs are patching walls and floors, painting, wallpapering, repairing roofs and gutters, and mending leaks. Amended tax return deadline However, repairs are sometimes treated as a permanent improvement and are not deductible. Amended tax return deadline See Permanent improvements , later, under Depreciating Your Home. Amended tax return deadline Security system. Amended tax return deadline   If you install a security system that protects all the doors and windows in your home, you can deduct the business part of the expenses you incur to maintain and monitor the system. Amended tax return deadline You also can take a depreciation deduction for the part of the cost of the security system relating to the business use of your home. Amended tax return deadline Utilities and services. Amended tax return deadline   Expenses for utilities and services, such as electricity, gas, trash removal, and cleaning services, are primarily personal expenses. Amended tax return deadline However, if you use part of your home for business, you can deduct the business part of these expenses. Amended tax return deadline Generally, the business percentage for utilities is the same as the percentage of your home used for business. Amended tax return deadline Telephone. Amended tax return deadline   The basic local telephone service charge, including taxes, for the first telephone line into your home (i. Amended tax return deadline e. Amended tax return deadline , landline) is a nondeductible personal expense. Amended tax return deadline However, charges for business long-distance phone calls on that line, as well as the cost of a second line into your home used exclusively for business, are deductible business expenses. Amended tax return deadline Do not include these expenses as a cost of using your home for business. Amended tax return deadline Deduct these charges separately on the appropriate form or schedule. Amended tax return deadline For example, if you file Schedule C (Form 1040), deduct these expenses on line 25, Utilities (instead of line 30, Expenses for business use of your home). Amended tax return deadline Depreciating Your Home If you own your home and qualify to deduct expenses for its business use, you can claim a deduction for depreciation. Amended tax return deadline Depreciation is an allowance for the wear and tear on the part of your home used for business. Amended tax return deadline You cannot depreciate the cost or value of the land. Amended tax return deadline You recover its cost when you sell or otherwise dispose of the property. Amended tax return deadline Before you figure your depreciation deduction, you need to know the following information. Amended tax return deadline The month and year you started using your home for business. Amended tax return deadline The adjusted basis and fair market value of your home (excluding land) at the time you began using it for business. Amended tax return deadline The cost of any improvements before and after you began using the property for business. Amended tax return deadline The percentage of your home used for business. Amended tax return deadline See Business Percentage , later. Amended tax return deadline Adjusted basis defined. Amended tax return deadline   The adjusted basis of your home is generally its cost, plus the cost of any permanent improvements you made to it, minus any casualty losses or depreciation deducted in earlier tax years. Amended tax return deadline For a discussion of adjusted basis, see Publication 551. Amended tax return deadline Permanent improvements. Amended tax return deadline   A permanent improvement increases the value of property, adds to its life, or gives it a new or different use. Amended tax return deadline Examples of improvements are replacing electric wiring or plumbing, adding a new roof or addition, paneling, or remodeling. Amended tax return deadline    You must carefully distinguish between repairs and improvements. Amended tax return deadline See Repairs , earlier, under Actual Expenses. Amended tax return deadline You also must keep accurate records of these expenses. Amended tax return deadline These records will help you decide whether an expense is a deductible or a capital (added to the basis) expense. Amended tax return deadline However, if you make repairs as part of an extensive remodeling or restoration of your home, the entire job is an improvement. Amended tax return deadline Example. Amended tax return deadline You buy an older home and fix up two rooms as a beauty salon. Amended tax return deadline You patch the plaster on the ceilings and walls, paint, repair the floor, install an outside door, and install new wiring, plumbing, and other equipment. Amended tax return deadline Normally, the patching, painting, and floor work are repairs and the other expenses are permanent improvements. Amended tax return deadline However, because the work gives your property a new use, the entire remodeling job is a permanent improvement and its cost is added to the basis of the property. Amended tax return deadline You cannot deduct any portion of it as a repair expense. Amended tax return deadline Adjusting for depreciation deducted in earlier years. Amended tax return deadline   Decrease the basis of your property by the depreciation you deducted, or could have deducted, on your tax returns under the method of depreciation you properly selected. Amended tax return deadline If you deducted less depreciation than you could have under the method you selected, decrease the basis by the amount you could have deducted under that method. Amended tax return deadline If you did not deduct any depreciation, decrease the basis by the amount you could have deducted. Amended tax return deadline   If you deducted more depreciation than you should have, decrease your basis by the amount you should have deducted, plus the part of the excess depreciation you deducted that actually decreased your tax liability for any year. Amended tax return deadline   If you deducted the incorrect amount of depreciation, see Publication 946. Amended tax return deadline Fair market value defined. Amended tax return deadline   The fair market value of your home is the price at which the property would change hands between a buyer and a seller, neither having to buy or sell, and both having reasonable knowledge of all necessary facts. Amended tax return deadline Sales of similar property, on or about the date you begin using your home for business, may be helpful in determining the property's fair market value. Amended tax return deadline Figuring the depreciation deduction for the current year. Amended tax return deadline   If you began using your home for business before 2013, continue to use the same depreciation method you used in past tax years. Amended tax return deadline   If you began using your home for business for the first time in 2013, depreciate the business part as nonresidential real property under the modified accelerated cost recovery system (MACRS). Amended tax return deadline Under MACRS, nonresidential real property is depreciated using the straight line method over 39 years. Amended tax return deadline For more information on MACRS and other methods of depreciation, see Publication 946. Amended tax return deadline   To figure the depreciation deduction, you must first figure the part of the cost of your home that can be depreciated (depreciable basis). Amended tax return deadline The depreciable basis is figured by multiplying the percentage of your home used for business by the smaller of the following. Amended tax return deadline The adjusted basis of your home (excluding land) on the date you began using your home for business. Amended tax return deadline The fair market value of your home (excluding land) on the date you began using your home for business. Amended tax return deadline Depreciation table. Amended tax return deadline   If 2013 was the first year you used your home for business, you can figure your 2013 depreciation for the business part of your home by using the appropriate percentage from the following table. Amended tax return deadline Table 2. Amended tax return deadline MACRS Percentage Table for 39-Year Nonresidential Real Property Month First Used for Business Percentage To Use 1 2. Amended tax return deadline 461% 2 2. Amended tax return deadline 247% 3 2. Amended tax return deadline 033% 4 1. Amended tax return deadline 819% 5 1. Amended tax return deadline 605% 6 1. Amended tax return deadline 391% 7 1. Amended tax return deadline 177% 8 0. Amended tax return deadline 963% 9 0. Amended tax return deadline 749% 10 0. Amended tax return deadline 535% 11 0. Amended tax return deadline 321% 12 0. Amended tax return deadline 107%   Multiply the depreciable basis of the business part of your home by the percentage from the table for the first month you use your home for business. Amended tax return deadline See Publication 946 for the percentages for the remaining tax years of the recovery period. Amended tax return deadline Example. Amended tax return deadline In May, George Miller began to use one room in his home exclusively and regularly to meet clients. Amended tax return deadline This room is 8% of the square footage of his home. Amended tax return deadline He bought the home in 2003 for $125,000. Amended tax return deadline He determined from his property tax records that his adjusted basis in the house (exclusive of land) is $115,000. Amended tax return deadline In May, the house had a fair market value of $165,000. Amended tax return deadline He multiplies his adjusted basis of $115,000 (which is less than the fair market value) by 8%. Amended tax return deadline The result is $9,200, his depreciable basis for the business part of the house. Amended tax return deadline George files his return based on the calendar year. Amended tax return deadline May is the 5th month of his tax year. Amended tax return deadline He multiplies his depreciable basis of $9,200 by 1. Amended tax return deadline 605% (. Amended tax return deadline 01605), the percentage from the table for the 5th month. Amended tax return deadline His depreciation deduction is $147. Amended tax return deadline 66. Amended tax return deadline Depreciating permanent improvements. Amended tax return deadline   Add the costs of permanent improvements made before you began using your home for business to the basis of your property. Amended tax return deadline Depreciate these costs as part of the cost of your home as explained earlier. Amended tax return deadline The costs of improvements made after you begin using your home for business (that affect the business part of your home, such as a new roof) are depreciated separately. Amended tax return deadline Multiply the cost of the improvement by the business-use percentage and depreciate the result over the recovery period that would apply to your home if you began using it for business at the same time as the improvement. Amended tax return deadline For improvements made this year, the recovery period is 39 years. Amended tax return deadline For the percentage to use for the first year, see Table 2, earlier. Amended tax return deadline For more information on recovery periods, see Publication 946. Amended tax return deadline Business Percentage To find the business percentage, compare the size of the part of your home that you use for business to your whole house. Amended tax return deadline Use the resulting percentage to figure the business part of the expenses for operating your entire home. Amended tax return deadline You can use any reasonable method to determine the business percentage. Amended tax return deadline The following are two commonly used methods for figuring the percentage. Amended tax return deadline Divide the area (length multiplied by the width) used for business by the total area of your home. Amended tax return deadline If the rooms in your home are all about the same size, you can divide the number of rooms used for business by the total number of rooms in your home. Amended tax return deadline Example 1. Amended tax return deadline Your office is 240 square feet (12 feet × 20 feet). Amended tax return deadline Your home is 1,200 square feet. Amended tax return deadline Your office is 20% (240 ÷ 1,200) of the total area of your home. Amended tax return deadline Your business percentage is 20%. Amended tax return deadline Example 2. Amended tax return deadline You use one room in your home for business. Amended tax return deadline Your home has 10 rooms, all about equal size. Amended tax return deadline Your office is 10% (1 ÷ 10) of the total area of your home. Amended tax return deadline Your business percentage is 10%. Amended tax return deadline Use lines 1-7 of Form 8829, or lines 1-3 on the Worksheet To Figure the Deduction for Business Use of Your Home (near the end of this publication) to figure your business percentage. Amended tax return deadline Deduction Limit If your gross income from the business use of your home equals or exceeds your total business expenses (including depreciation), you can deduct all your business expenses related to the use of your home. Amended tax return deadline If your gross income from the business use of your home is less than your total business expenses, your deduction for certain expenses for the business use of your home is limited. Amended tax return deadline Your deduction of otherwise nondeductible expenses, such as insurance, utilities, and depreciation of your home (with depreciation of your home taken last), that are allocable to the business, is limited to the gross income from the business use of your home minus the sum of the following. Amended tax return deadline The business part of expenses you could deduct even if you did not use your home for business (such as mortgage interest, real estate taxes, and casualty and theft losses that are allowable as itemized deductions on Schedule A (Form 1040)). Amended tax return deadline These expenses are discussed in detail under Actual Expenses , earlier. Amended tax return deadline The business expenses that relate to the business activity in the home (for example, business phone, supplies, and depreciation on equipment), but not to the use of the home itself. Amended tax return deadline If you are self-employed, do not include in (2) above your deduction for one-half of your self-employment tax. Amended tax return deadline Carryover of unallowed expenses. Amended tax return deadline   If your deductions are greater than the current year's limit, you can carry over the excess to the next year in which you use actual expenses. Amended tax return deadline They are subject to the deduction limit for that year, whether or not you live in the same home during that year. Amended tax return deadline Figuring the deduction limit and carryover. Amended tax return deadline   If you are an employee or a partner, or you file Schedule F (Form 1040), use the Worksheet To Figure the Deduction for Business Use of Your Home, near the end of this publication. Amended tax return deadline If you file Schedule C (Form 1040), figure your deduction limit and carryover on Form 8829. Amended tax return deadline Example. Amended tax return deadline You meet the requirements for deducting expenses for the business use of your home. Amended tax return deadline You use 20% of your home for business. Amended tax return deadline In 2013, your business expenses and the expenses for the business use of your home are deducted from your gross income in the following order. Amended tax return deadline    Gross income from business $6,000 Minus:   Deductible mortgage interest and real estate taxes (20%) 3,000 Business expenses not related to the use of your home (100%) (business phone, supplies, and depreciation on equipment) 2,000 Deduction limit $1,000 Minus other expenses allocable to business use of home:   Maintenance, insurance, and utilities (20%) 800 Depreciation allowed (20% = $1,600 allowable, but subject to balance of deduction limit) 200 Other expenses up to the deduction limit $1,000 Depreciation carryover to 2014 ($1,600 − $200) (subject to deduction limit in 2014) $1,400   You can deduct all of the business part of your deductible mortgage interest and real estate taxes ($3,000). Amended tax return deadline You also can deduct all of your business expenses not related to the use of your home ($2,000). Amended tax return deadline Additionally, you can deduct all of the business part of your expenses for maintenance, insurance, and utilities, because the total ($800) is less than the $1,000 deduction limit. Amended tax return deadline Your deduction for depreciation for the business use of your home is limited to $200 ($1,000 minus $800) because of the deduction limit. Amended tax return deadline You can carry over the $1,400 balance and add it to your depreciation for 2014, subject to your deduction limit in 2014. Amended tax return deadline More than one place of business. Amended tax return deadline   If part of the gross income from your trade or business is from the business use of part of your home and part is from a place other than your home, you must determine the part of your gross income from the business use of your home before you figure the deduction limit. Amended tax return deadline In making this determination, consider the time you spend at each location, the business investment in each location, and any other relevant facts and circumstances. Amended tax return deadline If your home office qualifies as your principal place of business, you can deduct your daily transportation costs between your home and another work location in the same trade or business. Amended tax return deadline For more information on transportation costs, see Publication 463, Travel, Entertainment, Gift, and Car Expenses. Amended tax return deadline Using the Simplified Method The simplified method is an alternative to the calculation, allocation, and substantiation of actual expenses. Amended tax return deadline In most cases, you will figure your deduction by multiplying $5, the prescribed rate, by the area of your home used for a qualified business use. Amended tax return deadline The area you use to figure your deduction is limited to 300 square feet. Amended tax return deadline See Simplified Amount , later, for information about figuring the amount of the deduction. Amended tax return deadline For more information about the simplified method, see Revenue Procedure 2013-13, 2013-06 I. Amended tax return deadline R. Amended tax return deadline B. Amended tax return deadline 478, available at www. Amended tax return deadline irs. Amended tax return deadline gov/irb/2013-06_IRB/ar09. Amended tax return deadline html. Amended tax return deadline Actual expenses and depreciation of your home. Amended tax return deadline   If you elect to use the simplified method, you cannot deduct any actual expenses for the business except for business expenses that are not related to the use of the home. Amended tax return deadline You also cannot deduct any depreciation (including any additional first-year depreciation) or section 179 expense for the portion of the home that is used for a qualified business use. Amended tax return deadline The depreciation deduction allowable for that portion of the home is deemed to be zero for a year you use the simplified method. Amended tax return deadline If you figure your deduction for business use of the home using actual expenses in a subsequent year, you will have to use the appropriate optional depreciation table for MACRS to figure your depreciation. Amended tax return deadline More information. Amended tax return deadline   For more information about claiming depreciation in a subsequent year, see Revenue Procedure 2013-13, 2013-06 I. Amended tax return deadline R. Amended tax return deadline B. Amended tax return deadline 478, available at www. Amended tax return deadline irs. Amended tax return deadline gov/irb/2013-06_IRB/ar09. Amended tax return deadline html. Amended tax return deadline See Publication 946 for the optional depreciation tables Although you cannot deduct any depreciation or section 179 expense for the portion of your home used for a qualified business use, you may still claim depreciation or the section 179 expense deduction on other assets used in the business (for example, furniture and equipment). Amended tax return deadline Expenses deductible without regard to business use. Amended tax return deadline   When using the simplified method, treat as personal expenses those business expenses related to the use of the home that are deductible without regard to whether there is a qualified business use of the home. Amended tax return deadline These expenses include mortgage interest, real estate taxes, and casualty losses, subject to any limitations. Amended tax return deadline See Where To Deduct , later. Amended tax return deadline If you also rent part of your home, you must still allocate these expenses between rental use and personal use (for this purpose, personal use includes business use reported using the simplified method). Amended tax return deadline No deduction of carryover of actual expenses. Amended tax return deadline   If you used actual expenses to figure your deduction for business use of the home in a prior year and your deduction was limited, you cannot deduct the disallowed amount carried over from the prior year during a year you figure your deduction using the simplified method. Amended tax return deadline Instead, you will continue to carry over the disallowed amount to the next year that you use actual expenses to figure your deduction. Amended tax return deadline Electing the Simplified Method You choose whether or not to figure your deduction using the simplified method each taxable year. Amended tax return deadline Make the election for a home by using the simplified method to figure the deduction for the qualified business use of that home on a timely filed, original federal income tax return. Amended tax return deadline An election for a taxable year, once made, is irrevocable. Amended tax return deadline A change from using the simplified method in one year to actual expenses in a succeeding taxable year, or vice-versa, is not a change in method of accounting and does not require the consent of the Commissioner. Amended tax return deadline Shared use. Amended tax return deadline   If you share your home with someone else who also uses the home in a business that qualifies for this deduction, each of you make your own election. Amended tax return deadline More than one qualified business use. Amended tax return deadline   If you conduct more than one business that qualifies for this deduction in your home, your election to use the simplified method applies to all your qualified business uses of that home. Amended tax return deadline More than one home. Amended tax return deadline   If you used more than one home during the year (for example, you moved during the year), you can elect to use the simplified method for only one of the homes. Amended tax return deadline You must figure the deduction for any other home using actual expenses. Amended tax return deadline Simplified Amount Your deduction for the qualified business use of a home is the sum of each amount you figure for a separate qualified business use of your home. Amended tax return deadline To figure your deduction for the business use of a home using the simplified method, you will need to know the following information for each qualified business use of the home. Amended tax return deadline The allowable area of your home used in conducting the business. Amended tax return deadline If you did not conduct the business for the entire year in the home or the area changed during the year, you will need to know the allowable area you used and the number of days you conducted the business for each month. Amended tax return deadline The gross income from the business use of your home. Amended tax return deadline The amount of the business expenses that are not related to the use of your home. Amended tax return deadline If the qualified business use is for a daycare facility that uses space in your home on a regular (but not exclusive) basis, you will also need to know the percentage of time that part of your home is used for daycare. Amended tax return deadline To figure the amount you can deduct for qualified business use of your home using the simplified method, follow these 3 steps. Amended tax return deadline Multiply the allowable area by $5 (or less than $5 if the qualified business use is for a daycare that uses space in your home on a regular, but not exclusive, basis). Amended tax return deadline See Allowable area and Space used regularly for daycare , later. Amended tax return deadline Subtract the expenses from the business that are not related to the use of the home from the gross income related to the business use of the home. Amended tax return deadline If these expenses are greater than the gross income from the business use of the home, then you cannot take a deduction for this business use of the home. Amended tax return deadline See Gross income limitation , later. Amended tax return deadline Take the smaller of the amounts from (1) and (2). Amended tax return deadline This is the amount you can deduct for this qualified business use of your home using the simplified method. Amended tax return deadline If you are an employee or a partner, or you use your home in your farming business and file Schedule F (Form 1040), you can use the Simplified Method Worksheet, near the end of this publication, to help you figure your deduction. Amended tax return deadline If you use your home in a trade or business and you file Schedule C (Form 1040), you will use the Simplified Method Worksheet in your Instructions for Schedule C to figure your deduction. Amended tax return deadline Allowable area. Amended tax return deadline   In most cases, the allowable area is the smaller of the actual area (in square feet) of your home used in conducting the business and 300 square feet. Amended tax return deadline Your allowable area may be smaller if you conducted the business as a qualified joint venture with your spouse, the area used by the business was shared with another qualified business use, you used the home for the business for only part of the year, or the area used by the business changed during the year. Amended tax return deadline You can use the Area Adjustment Worksheet (for simplified method), near the end of this publication, to help you figure your allowable area for a qualified business use. Amended tax return deadline Area used by a qualified joint venture. Amended tax return deadline   If the qualified business use of the home is also a qualified joint venture, you and your spouse will figure the deduction for the business use separately. Amended tax return deadline Split the actual area used in conducting business between you and your spouse in the same manner you split your other tax attributes. Amended tax return deadline Then, each spouse will figure the allowable area separately. Amended tax return deadline For more information about qualified joint ventures, see Qualified Joint Venture in the Instructions for Schedule C. Amended tax return deadline Shared use. Amended tax return deadline   If you share your home with someone else who uses the home to conduct business that also qualifies for this deduction, you may not include the same square feet to figure your deduction as the other person. Amended tax return deadline You must allocate the shared space between you and the other person in a reasonable manner. Amended tax return deadline Example. Amended tax return deadline Kristin and Lindsey are roommates. Amended tax return deadline Kristin uses 300 square feet of their home for a qualified business use. Amended tax return deadline Lindsey uses 200 square feet of their home for a separate qualified business use. Amended tax return deadline The qualified business uses share 100 square feet. Amended tax return deadline In addition to the portion that they do not share, Kristin and Lindsey can both claim 50 of the 100 square feet or divide the 100 square feet between them in any reasonable manner. Amended tax return deadline If divided evenly, Kristin could claim 250 square feet using the simplified method and Lindsey could claim 150 square feet. Amended tax return deadline More than one qualified business use. Amended tax return deadline   If you conduct more than one business qualifying for the deduction, you are limited to a maximum of 300 square feet for all of the businesses. Amended tax return deadline Allocate the actual square footage used (up to the maximum of 300 square feet) among your qualified business uses in a reasonable manner. Amended tax return deadline However, do not allocate more square feet to a qualified business use than you actually use for that business. Amended tax return deadline Rental use. Amended tax return deadline   The simplified method does not apply to rental use. Amended tax return deadline A rental use that qualifies for the deduction must be figured using actual expenses. Amended tax return deadline If the rental use and a qualified business use share the same area, you will have to allocate the actual area used between the two uses. Amended tax return deadline You cannot use the same area to figure a deduction for the qualified business use as you are using to figure the deduction for the rental use. Amended tax return deadline Part-year use or area changes. Amended tax return deadline   If your qualified business use was for a portion of the taxable year (for example, a seasonal business or a business that begins during the taxable year) or you changed the square footage of your qualified business use, your deduction is limited to the average monthly allowable square footage. Amended tax return deadline You calculate the average monthly allowable square footage by adding the amount of allowable square feet you used in each month and dividing the sum by 12. Amended tax return deadline When determining the average monthly allowable square footage, you cannot take more than 300 square feet into account for any one month. Amended tax return deadline Additionally, if your qualified business use was less than 15 days in a month, you must use -0- for that month. Amended tax return deadline Example 1. Amended tax return deadline Andy files his federal income tax return on a calendar year basis. Amended tax return deadline On July 20, he began using 420 square feet of his home for a qualified business use. Amended tax return deadline He continued to use the 420 square feet until the end of the year. Amended tax return deadline His average monthly allowable square footage is 125 square feet, which is figured using 300 square feet for each month August through December divided by the number of months in the taxable year ((0 + 0 + 0 + 0 + 0 + 0 + 0 + 300 + 300 + 300 + 300 + 300)/12). Amended tax return deadline Example 2. Amended tax return deadline Amy files her federal income tax return on a calendar year basis. Amended tax return deadline On April 20, she began using 100 square feet of her home for a qualified business use. Amended tax return deadline On August 5, she expanded the area of her qualified use to 330 square feet. Amended tax return deadline Amy continued to use the 330 square feet until the end of the year. Amended tax return deadline Her average monthly allowable square footage is 150 square feet, which is figured using 100 square feet for May through July and 300 square feet for August through December divided by the number of months in the taxable year ((0 + 0 + 0 + 0 + 100 + 100 +100 + 300 + 300 + 300 + 300 + 300)/12). Amended tax return deadline Gross income limitation. Amended tax return deadline   Your deduction for business use of the home is limited to an amount equal to the gross income derived from the qualified business use of the home reduced by the business deductions that are unrelated to the use of your home. Amended tax return deadline If the business deductions that are unrelated to the use of your home are greater than the gross income derived from the qualified business use of your home, then you cannot take a deduction for this qualified business use of your home. Amended tax return deadline Business expenses not related to use of the home. Amended tax return deadline   These expenses relate to the business activity in the home, but not to the use of the home itself. Amended tax return deadline You can still deduct business expenses that are unrelated to the use of the home. Amended tax return deadline See Where To Deduct , later. Amended tax return deadline Examples of business expenses that are unrelated to the use of the home are advertising, wages, supplies, dues, and depreciation for equipment. Amended tax return deadline Space used regularly for daycare. Amended tax return deadline   If you do not use the area of your home exclusively for daycare, you must reduce the prescribed rate (maximum $5 per square foot) before figuring your deduction. Amended tax return deadline The reduced rate will equal the prescribed rate times a fraction. Amended tax return deadline The numerator of the fraction is the number of hours that the space was used during the year for daycare and the denominator is the total number of hours during the year that the space was available for all uses. Amended tax return deadline You can use the Daycare Facility Worksheet (for simplified method), near the end of this publication, to help you figure the reduced rate. Amended tax return deadline    If you used at least 300 square feet for daycare regularly and exclusively during the year, then you do not need to reduce the prescribed rate or complete the Daycare Facility Worksheet. Amended tax return deadline Daycare Facility If you use space in your home on a regular basis for providing daycare, you may be able to claim a deduction for that part of your home even if you use the same space for nonbusiness purposes. Amended tax return deadline To qualify for this exception to the exclusive use rule, you must meet both of the following requirements. Amended tax return deadline You must be in the trade or business of providing daycare for children, persons age 65 or older, or persons who are physically or mentally unable to care for themselves. Amended tax return deadline You must have applied for, been granted, or be exempt from having, a license, certification, registration, or approval as a daycare center or as a family or group daycare home under state law. Amended tax return deadline You do not meet this requirement if your application was rejected or your license or other authorization was revoked. Amended tax return deadline Figuring the deduction. Amended tax return deadline   If you elect to use the simplified method for your home, figure your deduction as described earlier in Using the Simplified Method under Figuring the Deduction. Amended tax return deadline    If you are figuring your deduction using actual expenses and you regularly use part of your home for daycare, figure what part is used for daycare, as explained in Business Percentage , earlier, under Figuring the Deduction. Amended tax return deadline If you also use that part exclusively for daycare, deduct all the allocable expenses, subject to the deduction limit, as explained earlier. Amended tax return deadline   If the use of part of your home as a daycare facility is regular, but not exclusive, you must figure the percentage of time that part of your home is used for daycare. Amended tax return deadline A room that is available for use throughout each business day and that you regularly use in your business is considered to be used for daycare throughout each business day. Amended tax return deadline You do not have to keep records to show the specific hours the area was used for business. Amended tax return deadline You can use the area occasionally for personal reasons. Amended tax return deadline However, a room you use only occasionally for business does not qualify for the deduction. Amended tax return deadline To find the percentage of time you actually use your home for business, compare the total time used for business to the total time that part of your home can be used for all purposes. Amended tax return deadline You can compare the hours of business use in a week with the number of hours in a week (168). Amended tax return deadline Or you can compare the hours of business use for the year with the number of hours in the year (8,760 in 2013). Amended tax return deadline If you started or stopped using your home for daycare in 2013, you must prorate the number of hours based on the number of days the home was available for daycare. Amended tax return deadline Example 1. Amended tax return deadline Mary Lake used her basement to operate a daycare business for children. Amended tax return deadline She figures the business percentage of the basement as follows. Amended tax return deadline Square footage of the basement Square footage of her home = 1,600 3,200 = 50%           She used the basement for daycare an average of 12 hours a day, 5 days a week, for 50 weeks a year. Amended tax return deadline During the other 12 hours a day, the family could use the basement. Amended tax return deadline She figures the percentage of time the basement was used for daycare as follows. Amended tax return deadline Number of hours used for daycare (12 x 5 x 50) Total number of hours in the year (24 x 365) = 3,000 8,760 = 34. Amended tax return deadline 25%           Mary can deduct 34. Amended tax return deadline 25% of any direct expenses for the basement. Amended tax return deadline However, because her indirect expenses are for the entire house, she can deduct only 17. Amended tax return deadline 13% of the indirect expenses. Amended tax return deadline She figures the percentage for her indirect expenses as follows. Amended tax return deadline Business percentage of the basement 50% Multiplied by: Percentage of time used for daycare × 34. Amended tax return deadline 25% Percentage for indirect expenses 17. Amended tax return deadline 13% Mary completes Form 8829, Part I, figuring the percentage of her home used for business, including the percentage of time the basement was used. Amended tax return deadline In Part II, Mary figures her deductible expenses. Amended tax return deadline She uses the following information to complete Part II. Amended tax return deadline Gross income from her daycare business $50,000 Expenses not related to the business use of the home $25,000 Tentative profit $25,000 Rent $8,400 Utilities $850 Painting the basement $500 Mary enters her tentative profit, $25,000, on line 8. Amended tax return deadline (This figure is the same as the amount on line 29 of her Schedule C (Form 1040). Amended tax return deadline ) The expenses she paid for rent and utilities relate to her entire home. Amended tax return deadline Therefore, she enters the amount paid for rent on line 18, column (b), and the amount paid for utilities on line 20, column (b). Amended tax return deadline She shows the total of these expenses on line 22, column (b). Amended tax return deadline For line 23, she multiplies the amount on line 22, column (b) by the percentage on line 7 and enters the result, $1,585. Amended tax return deadline Mary paid $500 to have the basement painted. Amended tax return deadline The painting is a direct expense. Amended tax return deadline However, because she did not use the basement exclusively for daycare, she must multiply $500 by the percentage of time the basement was used for daycare (34. Amended tax return deadline 25% – line 6). Amended tax return deadline She enters $171 (34. Amended tax return deadline 25% × $500) on line 19, column (a). Amended tax return deadline She adds line 22, column (a), and line 23 and enters $1,756 ($171 + $1,585) on line 25. Amended tax return deadline This is less than her deduction limit (line 15), so she can deduct the entire amount. Amended tax return deadline She follows the instructions to complete the rest of Part II and enters $1,756 on lines 33 and 35. Amended tax return deadline She then carries the $1,756 to line 30 of her Schedule C (Form 1040). Amended tax return deadline Example 2. Amended tax return deadline Assume the same facts as in Example 1 except that Mary also has another room that was available each business day for children to take naps in. Amended tax return deadline Although she did not keep a record of the number of hours the room was actually used for naps, it was used for part of each business day. Amended tax return deadline Since the room was available for business use during regular operating hours each business day and was used regularly in the business, it is considered used for daycare throughout each business day. Amended tax return deadline The basement and room are 60% of the total area of her home. Amended tax return deadline In figuring her expenses, 34. Amended tax return deadline 25% of any direct expenses for the basement and room are deductible. Amended tax return deadline In addition, 20. Amended tax return deadline 55% (34. Amended tax return deadline 25% × 60%) of her indirect expenses are deductible. Amended tax return deadline Example 3. Amended tax return deadline Assume the same facts as in Example 1 except that Mary stopped using her home for a daycare facility on June 24, 2013. Amended tax return deadline She used the basement for daycare an average of 12 hours a day, 5 days a week, but for only 25 weeks of the year. Amended tax return deadline During the other 12 hours a day, the family could still use the basement. Amended tax return deadline She figures the percentage of time the basement was used for business as follows. Amended tax return deadline Number of hours used for daycare (12 x 5 x 25) Total number of hours during period used (24 x 175) = 1,500 4,200 = 35. Amended tax return deadline 71%           Mary can deduct 35. Amended tax return deadline 71% of any direct expenses for the basement. Amended tax return deadline However, because her indirect expenses are for the entire house, she can deduct only 17. Amended tax return deadline 86% of the indirect expenses. Amended tax return deadline She figures the percentage for her indirect expenses as follows. Amended tax return deadline Business percentage of the basement 50% Multiplied by: Percentage of time used for daycare × 35. Amended tax return deadline 71% Percentage for indirect expenses 17. Amended tax return deadline 86% Meals. Amended tax return deadline   If you provide food for your daycare recipients, do not include the expense as a cost of using your home for business. Amended tax return deadline Claim it as a separate deduction on your Schedule C (Form 1040). Amended tax return deadline You can never deduct the cost of food consumed by you or your family. Amended tax return deadline You can deduct as a business expense 100% of the actual cost of food consumed by your daycare recipients (see Standard meal and snack rates , later, for an optional method for eligible children) and generally only 50% of the cost of food consumed by your employees. Amended tax return deadline However, you can deduct 100% of the cost of food consumed by your employees if its value can be excluded from their wages as a de minimis fringe benefit. Amended tax return deadline For more information on meals that meet these requirements, see Meals in chapter 2 of Publication 15-B, Employer's Tax Guide to Fringe Benefits. Amended tax return deadline   If you deduct the actual cost of food for your daycare business, keep a separate record (with receipts) of your family's food costs. Amended tax return deadline   Reimbursements you receive from a sponsor under the Child and Adult Care Food Program of the Department of Agriculture are taxable only to the extent they exceed your expenses for food for eligible children. Amended tax return deadline If your reimbursements are more than your expenses for food, show the difference as income in Part I of Schedule C (Form 1040). Amended tax return deadline If your food expenses are greater than the reimbursements, show the difference as an expense in Part V of Schedule C (Form 1040). Amended tax return deadline Do not include payments or expenses for your own children if they are eligible for the program. Amended tax return deadline Follow this procedure even if you receive a Form 1099-MISC, Miscellaneous Income, reporting a payment from the sponsor. Amended tax return deadline Standard meal and snack rates. Amended tax return deadline   If you qualify as a family daycare provider, you can use the standard meal and snack rates, instead of actual costs, to compute the deductible cost of meals and snacks provided to eligible children. Amended tax return deadline For these purposes: A family daycare provider is a person engaged in the business of providing family daycare. Amended tax return deadline Family daycare is childcare provided to eligible children in the home of the family daycare provider. Amended tax return deadline The care must be non-medical, not involve a transfer of legal custody, and generally last less than 24 hours each day. Amended tax return deadline Eligible children are minor children receiving family daycare in the home of the family daycare provider. Amended tax return deadline Eligible children do not include children who are full-time or part-time residents in the home where the childcare is provided or children whose parents or guardians are residents of the same home. Amended tax return deadline Eligible children do not include children who receive daycare services for personal reasons of the provider. Amended tax return deadline For example, if a provider provides daycare services for a relative as a favor to that relative, that child is not an eligible child. Amended tax return deadline   You can compute the deductible cost of each meal and snack you actually purchased and served to an eligible child during the time period you provided family daycare using the standard meal and snack rates shown in Table 3, later. Amended tax return deadline You can use the standard meal and snack rates for a maximum of one breakfast, one lunch, one dinner, and three snacks per eligible child per day. Amended tax return deadline If you receive reimbursement for a particular meal or snack, you can deduct only the portion of the applicable standard meal or snack rate that is more than the amount of the reimbursement. Amended tax return deadline   You can use either the standard meal and snack rates or actual costs to calculate the deductible cost of food provided to eligible children in the family daycare for any particular tax year. Amended tax return deadline If you choose to use the standard meal and snack rates for a particular tax year, you must use the rates for all your deductible food costs for eligible children during that tax year. Amended tax return deadline However, if you use the standard meal and snack rates in any tax year, you can use actual costs to compute the deductible cost of food in any other tax year. Amended tax return deadline   If you use the standard meal and snack rates, you must maintain records to substantiate the computation of the total amount deducted for the cost of food provided to eligible children. Amended tax return deadline The records kept should include the name of each child, dates and hours of attendance in the daycare, and the type and quantity of meals and snacks served. Amended tax return deadline This information can be recorded in a log similar to the one shown in Exhibit A, near the end of this publication. Amended tax return deadline   The standard meal and snack rates include beverages, but do not include non-food supplies used for food preparation, service, or storage, such as containers, paper products, or utensils. Amended tax return deadline These expenses can be claimed as a separate deduction on your Schedule C (Form 1040). Amended tax return deadline     Table 3. Amended tax return deadline Standard Meal and Snack Rates1 Location of Family Daycare Provider Breakfast Lunch Dinner Snack States other than Alaska an