Karan M. Hintze - Page 20

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          Section 280A(c)(1) provides an exception to this general rule for           
          any item allocable to a portion of the dwelling unit which is               
          exclusively used by the taxpayer on a regular basis as the                  
          principal place of business for a trade or business of the                  
          taxpayer.  A taxpayer "exclusively" uses a portion of his                   
          dwelling in a trade or business if and only if the portion in               
          question is not at any time during the taxable year used for                
          nonbusiness purposes.  See Hefti v. Commissioner, T.C. Memo.                
               During the years at issue, petitioner resided in a one-                
          bedroom one-bathroom13 condominium containing 850 square feet of            
          living space.  Petitioner designated 500 square feet of her                 
          condominium as having been used for business purposes.  The space           
          so designated includes her entire living room and dining room,              
          her entire bathroom, and the portion of the kitchen containing              
          the sink.  While petitioner contends that she used this portion             
          of her condominium for business purposes, she does not contend              
          that such business use was exclusive.  In any event, we would               
          find any claim of exclusive business use implausible.                       
          Accordingly, we sustain respondent’s disallowance of the                    
          deductions claimed by petitioner for business use of her home.              

               13  Petitioner testified that she added a second bathroom in           
          the closet of her bedroom.  Petitioner, however, did not                    
          introduce evidence of any such remodeling.                                  

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Last modified: May 25, 2011