Thanks in advance for comments and answers.
I believe some of these are pretty basic questions. I have been a bit
wordy to make sure I am getting clear complete answers.
A. Home-office deductions don't add up to much and trigger audits
more. I would just skip it rather than take deduction. If I can do a
regular office deduction will it be a very good deduction for my
S-Corp and not trigger audits more? Will it not trigger audits more
even if I own it / one of my companies own it and even if it's not
zoned for commercial? I suppose it's worth my having a separate office
space though even though it costs me more to do so.
B. If my office is not zoned for commercial (it's an internet biz and
I don't have employees just contract workers occasionally), it can
still qualify as not home-office as long as I have another residence
right? Even if I am at the office a very large number of hours? What
if my rent elsewhere is very cheap (or free)? Since I work long hours
I would want to keep food and toiletries there, have a break/rec room
with bed, etc.
C. I'm told that I don't want my S-Corp to own real estate, and for
liability purposes I should not own it personally (because I will have
tenants), so I want to start an LLC and transfer my new
property/properties to the LLC. But I am wondering if there are any
bigger tax benefits to owning it personally or having the S-Corp
itself own it, or some solution I have not thought of. Hopefully the
benefits are the same or better if the LLC owns it and leases it to
the S-Corp. (What I want to do is have multi-family properties and
rent the other units out, and one is my office. Also my LLC would rent
me a home/residence most likely.)
D. Since my S-Corp is renting from me, how does that compare to
renting from someone else? I know I get benefit because I am paying
into equity and not someone's else equity but at the moment I do not
know what I get to deduct. If I were renting from someone else I
figure I get to deduct the entire monthly rent, but I think I couldn't
make my S-Corp pay a reasonable monthly rent to my LLC and deduct
that? But I can deduct 1/2 the mortgage payment (and 1/2 the taxes and
such) if it's a 2 unit with equal sq footage on both sides (office is
one of them)?
E. What if I shared/sublet my office unit for office/storage space? I
figure I can have the person/company pay my LLC in whatever way
desired (monthly rent would be the obvious option). What restrictions
would there be in order to be able to still get my same deductions? If
a person (NOT ME) lived/resided there at times does that mess it up,
even if it's not their primary residence?
F. I figure that situation of my office being 1 unit in a duplex has
gotta be ok. What if I added a 2nd entrance and then I lived in part
of the 1 office unit - does it qualify because of having 2nd entrance
or is it now a home-office? I figure that's home-office but wanted to
check. What if it was another person living there or company renting
instead of me living there? Does it make a difference whether the part
is totally blocked off versus if there's a door (always kept locked)
separating the two small pseudo-units? If I were able to have the
pseudo units somehow "officially" made separate units then it would
have to count right, just as if the building were a triplex to begin
with?
Anything else that I should know, find out, consider? |
