Author Topic: I built an office for 100% business use. What can I deduct?  (Read 1611 times)

Syonyk

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I built an office for 100% business use. What can I deduct?
« on: December 11, 2016, 09:03:13 PM »
Into what I assume are reasonably esoteric corners of tax code:

My wife & I own a ~2000 sq ft house.  Over the summer, I built myself a separate office out of a shed.  It's insulated, solar powered, has a computer desk and a workbench, and is 100% for business use - either my day job or my research projects which are lined up with one of my alternate income streams.

I've got... oh, about $15k into the construction, though probably a bit more with some of the improvements I've made.  Call it $17k.

What can I do with this, from a tax perspective?  I'm familiar with home offices that are part of a home, not an outbuilding constructed specifically for business use.

Pointers and tax code suggestions appreciated!  My taxes this year are complex enough that I'm probably going to have a professional do them (multiple states, variety of income, lots of investment sales, etc), but I'd like to get an idea of what I can work with now.

Drifterrider

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Re: I built an office for 100% business use. What can I deduct?
« Reply #1 on: December 12, 2016, 05:43:24 AM »
I would say you are going to have to depreciate it rather than expense it because, you have a free standing building.

Does it have plumbing?

Syonyk

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Re: I built an office for 100% business use. What can I deduct?
« Reply #2 on: December 12, 2016, 06:17:23 AM »
No plumbing.

CareCPA

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Re: I built an office for 100% business use. What can I deduct?
« Reply #3 on: December 12, 2016, 06:35:44 AM »
Without more details, my initial thought is:
Separate out the costs of just the building. This will most likely be a commercial building - 39 years for tax. Again, this is an assumption, I don't have the full details of your work or your office.
Then separate out computer and other equipment, furniture, etc. These will be over a shorter life. If they are brand new, you can take bonus, and if you have income this year, you can 179 expense them.

Take this as generic. Your tax accountant will have more specific answers after (s)he considers your specific situation.