Non-personal tax question

[Racewin]

This is tax related, so if that is a no-no, please delete or lock. With a home business and working through potential deductions (using Turbo Tax), it asks when the home was purchased or acquired and the cost of the home. Would this info be from when it was originally mortgaged or when it was refinanced?

 

[smithers599]

Mortgage/refinance got nothing to do with it.
Date acquired. Date on the deed. (Go to County Assessor's website, or County Recorder's website.)

 

[YNOTAZ]

The IRS issued a simple answer: date of acquisition and cost would calculate into home depreciation and do not play to business deduction for a home office.

• Right from IRS
  • standard deduction of $5 per sq foot to max of 300sqft
  • Itemized deduction
    • allowable of itemized are percentage of mortgage interest, taxes, insurance
    • NO HOME DEPRECIATION
    
    https://www.irs.gov/businesses/small-businesses-self-employed/simplified-option-for-home-office-deduction

 

[Abbey]

https://michelecagancpa.com/calculate-depreciation/

That is a good description link, but I use an accountant. I quit doing my own taxes once I had to start worrying about depreciation schedules.

Another thing to keep in mind is that any home depreciation will also need to be accounted for when you sell your home, separate from the capital gains exclusion.

The text YNOTAZ quoted is for the "simplified home office deduction". The regular deduction allows depreciation of your home but gets more complicated. If it were just me, I'd probably do simplified, but since I had to use an accountant for Schedule C & other business stuff, they just included the home depreciation to maximize tax savings.