My apartment is approx 900 square feet and we use around 300 square feet for our business. (home office, storage, etc)
I know that I can write of certain things, but I was wondering if it's ok to split the expense 1/3 so the business is paying 1/3 on utility, mortgage, etc.?
As far as whether or not i can claim those expense - I know I'd need to check with an accountant. However, is it ok for the business to spend this money - even though it MAY not be able to be claimed? It will really help me with my load - I'm giving myself a paycheck every month, and paying 100% of my apartment expense out of that paycheck. But since 1/3 of it is really only for business use, I felt that I should get reimbursed by my business account.
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It would be easiest to pay all your bills out of your personal account, then write one check a month like the business is paying you rent and reimburse yourself for expenses.
You would need to get a tax accountant's opinion on this...I believe in order to claim part of your residence as a business you have to show that you receive customers and/or clients on the premises and the residence not be zoned for residential only...But that is an IRS rule for the USA and if you're not here it won't apply to you.
Depends partly on your state, and also if you own the home. If you rent, then it's likely a breach of the lease to use your apartment for a business.
Ask your tax accountant on the amount of the mortgage and other expenses you can write off. The space must be used SOLELY for the business - you can't claim the kitchen table as part of your office space. It would have to be a separate room in the house.
The IRS allows you to deduct the % of the expenses of your dwelling as a business expense. You need not write 2 checks, merely take the % of the space.
Realize however, the IRS has very strict guidelines for what is defined as business space. You may not use the space for any personal use. (They have disallowed claims when photos have shown a dogdish under a desk) It also must be a completely enclosed space, 1005 dedicated. You can not take 50% of the dining room for example, because you have your desk there.