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Mr. Popov took measurements of the apartment and determined
that the living room took up 40 percent of the entire apartment
space. The record also includes a rough diagram of the layout of
their apartment. Petitioners claimed a home office deduction for
the living room and deducted $3,600 or 40 percent of the rent for
the year and $109 or 20 percent of the electricity for the year.
There is no dispute as to the cost of the rent or electricity.
Section 280A(a) generally disallows a deduction with respect
to the use of a taxpayer’s personal residence. Section
280A(c)(1)(A), however, provides that section 280A(a) shall not
apply if a portion of the taxpayer’s personal residence is
exclusively used on a regular basis as the principal place of
business for any trade or business of the taxpayer. The
exclusive use of a portion of a taxpayer’s dwelling unit means
that the taxpayer must use a specific part of the dwelling unit
solely for the purpose of carrying on his trade or business.
We are satisfied that a specific portion of the living room
was exclusively used by Mrs. Popov for her practicing and
recording activities during 1993.
Additionally, we must address the question of whether the
home office constitutes Mrs. Popov’s principal place of business.
The Supreme Court in Commissioner v. Soliman, 506 U.S. 168
(1993), identified two primary considerations to decide whether
an office located within a taxpayer’s dwelling unit is a
taxpayer’s principal place of business: (1) The relative
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