Let’s talk home office expenses. I am a small business owner working from home. I am drinking a lot of coffee in my home office. This i

Let’s talk home office expenses. I am a small business owner working from home. I am drinking a lot of coffee in my home office. This is a stretch, but is there any way I could deduct coffee expenses as a perk of the job?

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0 thoughts on “Let’s talk home office expenses. I am a small business owner working from home. I am drinking a lot of coffee in my home office. This i”

  1. Without to the slightest degree offering tax advice, I refer to the excellent IRS circular on home office deductions. My thought as to its key provision is the distinction – the DISTINCTION – between your work area and residence area. Even a tape on the floor, but better a separate room or rooms. That would translate to having two coffee makers, two sets of supplies, two sets, even, of cups. You never want to cross the IRS but if you follow their rules (which are usually quite reasonable and usually well documented) you can get the deductions you deserve. Ask your tax pro or even your local VITA clinic volunteers.

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  2. Trade or Business Expenses
    I.R.C. § 162(a) In General —
    “There shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business…”
    Generally speaking there is little to no chance of you being able to deduct coffee which you serve yourself in your home office because it does not fit the definition of an ordinary and necessary business expense under IRC Sec 162.
    That said, meals expense which may include an expense for coffee can be deducted (usually up to 50% but that law has been temporarily suspended) if the expense is incurred as part of a business meeting which has a business purpose (ie: a meeting where business is discussed).
    There is much more detail and guidance with regard to these two laws : Trade or Business expenses and Meals deductions, but given the way you have described your coffee expense, the answer is “No”.

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  3. Sarah: Home Office expense are one of the most scrutinized tax deductions by the IRS. Don’t even go there with trying to add a beverage. And with all of those working from home, you might be able to hide but it’s not worth it. There are so many complications like measuring the office space as a percentage of the total S.F. of the residence for starters. Anything in the home office that could be considered dual use (like a TV) would exclude the home office deduction. So please just consider your beverage costs your personal expenses.

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