Remove home office deduction via amended return

Am I allowed to remove home office deductions from a home business via an amended return (both 2020 and 2021)? I discovered today that it can affect capital gains when selling the home, and my deduction amount is not enough to worry about/keep track of that. I'd rather pay more in this instance and keep things simple.

x

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

• Mark as New
• Bookmark
• Subscribe
• Subscribe to RSS Feed
• Permalink
• Print
• Report Inappropriate Content

Remove home office deduction via amended return

Did you use the simplified method or actual expenses.

• Mark as New
• Bookmark
• Subscribe
• Subscribe to RSS Feed
• Permalink
• Print
• Report Inappropriate Content

Remove home office deduction via amended return

I used actual expenses.

• Mark as New
• Bookmark
• Subscribe
• Subscribe to RSS Feed
• Permalink
• Print
• Report Inappropriate Content

Remove home office deduction via amended return

amend your return to use the "simplified method"

you still have time to amend a 2020 return for a refund.

There is no time limitation for a tax return if the "amount you owe" is going up.

• Mark as New
• Bookmark
• Subscribe
• Subscribe to RSS Feed
• Permalink
• Print
• Report Inappropriate Content

Remove home office deduction via amended return

@fanfare wrote:

amend your return to use the "simplified method"

you still have time to amend a 2020 return for a refund.

If actual expenses were used, that would include depreciation deductions and those were taken on income tax returns for two or more consecutive tax years (2020 and 2021).

As a result, switching would (or at least might) be considered a change in the method of accounting which requires that Form 3115 be filed (in this case there would be a positive Section 481(a) adjustment).

• Mark as New
• Bookmark
• Subscribe
• Subscribe to RSS Feed
• Permalink
• Print
• Report Inappropriate Content

Remove home office deduction via amended return

In my opinion, it is FAR more work and worry to amend, then to keep track of the depreciation (and the program should be keeping track of the accumulated depreciation anyways).

As was indicated by another comment, unless you use the Simplified Method, the depreciation will affect thing when you sell the home. But that tax-savings now is usually larger than any tax-cost when you sell the home.

• Mark as New
• Bookmark
• Subscribe
• Subscribe to RSS Feed
• Permalink
• Print
• Report Inappropriate Content

Remove home office deduction via amended return

I discovered today that it can affect capital gains when selling the home, and my deduction amount is not enough to worry about/keep track of that. I'd rather pay more in this instance and keep things simple.

Be aware and understand this:

If you did not use the simplified method, then when you sell the property/asset you are required to recapture and pay taxes on the depreciation you "SHOULD" have taken, in the tax year you sell the property/asset.

So if you are going to remove and not claim the home office at all, then no problem. Otherwise, switch to the simplified method.