Can I Get a Home Business Tax Deduction If I Have Two Businesses?

 

If you run two businesses from your home, you can take a home business tax deduction for both businesses. However, there are rules you must follow. 

You can claim the home office deduction if you have a dedicated workspace in your home for an office. This area can’t be used for personal activities. To claim it for two different businesses, the office space must qualify as the principal place of business for both. 

If both businesses meet the criteria for a home office deduction, you need to file a separate Form 8829: Expenses for Business Use of Your Home for each business. 

How to determine your home office deduction 

To deduct home business expenses, divide the expenses between the two businesses. Base the split on how much you use your home office for each business. You have to manually divide your office space and enter it as if you had two separate offices. The total square footage submitted for each business can’t be more than the total square footage you would submit if you only had one home business. You can choose to divide your space based on time or space usage. 

You can also use the simplified method for your home office deduction. If so, you’re limited to a maximum of 300 square feet for all your businesses combined. Divide the 300 square feet among your businesses in a logical way. Don’t give more square feet to a business than you actually use for that business.

Have more questions about home office deductions?

Have additional questions about the home office deduction? Rely on our team of small business certified tax pros to get your taxes right and keep your business on track. Connect with us at blockadvisors.com.

Our small business tax professional certification is awarded by Block Advisors, a part of H&R Block, based upon successful completion of proprietary training. Our Block Advisors small business services are available at participating Block Advisors and H&R Block offices nationwide.

Related Resources

Claiming Expenses Self Employed

Learn more about claiming expenses when self-employed with advice from the tax experts at H&R Block.

Filing Small Business Taxes

Do you need help filing taxes for your small business? Learn more about preparing a W-2 and get tax answers from H&R Block.

What payroll tax deferral means for business owners and employees

How does the payroll tax deferral affect you? Find out from the tax experts at H&R Block what this means to your business and your employees.

Taxes in the Gig Economy

The gig economy and taxes go hand-in-hand. If gig work is your primary form of income, review these important tax tips from our H&R Block tax professionals.