Question

I operate an in-home business. What business documents do I need to claim business expenses?

Answer

To claim business expenses you will need to provide related business documents including receipts for all of the business expenses you want to deduct. Your documents should show:

  • Amount
  • Date
  • Place
  • Essential character of the expense

The documents can include:

  • Receipts
  • Cancelled checks
  • An account book
  • Customer account book
  • Expense report
  • Accounting log
  • A diary
  • Calendar
  • Other record that duplicates information shown on a receipt kept at or near the time of the expense

After you file, you should keep these business documents with a copy of your tax return.

For the business use of your home, you’ll allocate the home office expenses. This is based on the percentage of the square footage of your home used regularly and exclusively for business.

Expenses you might incur when running a business from your home include:

  • Real estate taxes
  • Qualified mortgage insurance premiums
  • Deductible mortgage interest
  • Casualty losses
  • Depreciation
  • Insurance
  • Rent
  • Repairs
  • Security system
  • Utilities and services

Related Topics

Related Resources

Preparing Your Tax Document Checklist

If you are just getting your tax documents together and figuring out what to do next, here is a handy checklist to help you keep everything organized.

Form 8283 -Large Item Donations

Learn how to deduct large item donations of more than $500 with the tax experts at H&R Block.

Arizona (AZ) Tax Refund

Are you a wage earner in Arizona? Learn more about checking the status of your AZ state refund, with help from the tax experts at H&R Block.

Personal Tax Allowances and Dependent Exemptions

What's the difference between allowances and dependent exemptions? Get tax answers from H&R Block.