S Corporation Reimburses the Owner-Employee for the Home Office

Question

I asked my CPA about claiming the home-office deduction for my S corporation.

His answer: For an S corporation, there is no tax benefit to the home-office deduction for the corporation. The home-office deduction applies only to self-employed individuals.

What do you think?

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Answer

Your CPA is wrong. The home-office deduction is available to the S corporation because the corporation can reimburse the home office as an employee business expense.

Under the reimbursement method,

• the corporation deducts the home-office reimbursement as an employee business expense, and
• you, the employee of your S corporation, have no income from the reimbursement.

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