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Petitioners' home is approximately 1,300 square feet, and
petitioner's home office is approximately 110 square feet. When
petitioners' children grew up and moved out, petitioner converted
one of the bedrooms in the house for use as a home office.
Petitioner does not have an office located anywhere else and
does not use this room in the house for any purpose other than a
home office. No person other than petitioner uses the room.
There is no bed or dresser located in the room, and petitioner
does not use the room for any type of storage.
Petitioner has one phone line for the household that doubles
as a business line. Petitioner keeps business-related materials
in the room, such as a computer, books pertaining to his trade,
and business records.
Respondent did not raise an issue regarding substantiation.
OPINION
Section 162(a) allows a deduction for the ordinary and
necessary expenses paid or incurred during the taxable year in
carrying on a trade or business.
Section 280A, in general, disallows deductions with respect
to the use of a dwelling unit that is used by the taxpayer during
the taxable year as a residence. However, section 280A(c)(1)(A)
permits the deduction of expenses allocable to a portion of the
dwelling unit which is exclusively used on a regular basis as
"the principal place of business for any trade or business of the
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Last modified: May 25, 2011