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            Department of the Treasury                        Contents
            Internal Revenue Service
                                                              Future Developments . . . . . . . . . . . . . . . . . . . . . . .          1
                                                              Reminders    . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Publication 587
Cat. No. 15154T                                               Introduction  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2
                                                              Qualifying for a Deduction . . . . . . . . . . . . . . . . . . .           2
                                                              Exclusive Use       . . . . . . . . . . . . . . . . . . . . . . . . . . .  3
Business Use                                                  Regular Use . . . . . . . . . . . . . . . . . . . . . . . . . . . .        3
                                                              Trade or Business Use             . . . . . . . . . . . . . . . . . . . .  3
                                                              Principal Place of Business . . . . . . . . . . . . . . . . .              3
of Your Home
                                                              Place To Meet Patients, Clients, or 
                                                                    Customers . . . . . . . . . . . . . . . . . . . . . . . . . . .      5
(Including Use by                                             Separate Structure          . . . . . . . . . . . . . . . . . . . . . . .  6
Daycare Providers)                                            Figuring the Deduction        . . . . . . . . . . . . . . . . . . . . . .  6
                                                              Using Actual Expenses . . . . . . . . . . . . . . . . . . . .              6
For use in preparing                                          Using the Simplified Method               . . . . . . . . . . . . . . .    10
                                                              Daycare Facility    . . . . . . . . . . . . . . . . . . . . . . . . . .    12
2023 Returns
                                                              Sale or Exchange of Your Home . . . . . . . . . . . . . .                  14
                                                              Business Furniture and Equipment                  . . . . . . . . . . .    16
                                                              Recordkeeping . . . . . . . . . . . . . . . . . . . . . . . . . . .        17
                                                              Where To Deduct       . . . . . . . . . . . . . . . . . . . . . . . . .    18
                                                              Self-Employed Persons . . . . . . . . . . . . . . . . . . .                18
                                                              Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       19
                                                              Worksheet To Figure the Deduction for 
                                                              Business Use of Your Home . . . . . . . . . . . . . .                      19
                                                              Worksheets To Figure the Deduction for 
                                                              Business Use of Your Home (Simplified 
                                                              Method)       . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    23
                                                              How To Get Tax Help       . . . . . . . . . . . . . . . . . . . . . . .    27
                                                              Exhibit A. Family Daycare Provider Meal and 
                                                              Snack Log         . . . . . . . . . . . . . . . . . . . . . . . . . . .    32
                                                              Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  33

                                                              Future Developments
                                                              For  the  latest  information  about  developments  related  to 
                                                              Pub.  587,  such  as  legislation  enacted  after  it  was 
                                                              published, go to IRS.gov/Pub587.

                                                              Reminders
                                                              Mortgage  insurance  premiums.                  The  itemized  deduc-
                                                              tion  for  mortgage  insurance  premiums  has  expired.  You 
                                                              can no longer claim the deduction as of tax year 2022.
                                                              Simplified method for business use of home deduc-
Get forms and other information faster and easier at:         tion. The IRS provides a simplified method to figure your 
• IRS.gov (English)         • IRS.gov/Korean (한국어) 
• IRS.gov/Spanish (Español) • IRS.gov/Russian (Pусский) 
• IRS.gov/Chinese (中文)      • IRS.gov/Vietnamese (Tiếng Việt) 

Feb 22, 2024

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expenses for business use of your home. For more infor- Comments and suggestions. We welcome your com-
mation, see Using the Simplified Method under Figuring ments about this publication and suggestions for future
the Deduction, later. editions.
Photographs of missing children. The Internal Reve- You can send us comments through IRS.gov/
nue Service is a proud partner with the National Center for FormComments. Or, you can write to the Internal Revenue
Missing & Exploited Children® (NCMEC). Photographs of Service, Tax Forms and Publications, 1111 Constitution
missing children selected by the Center may appear in Ave. NW, IR-6526, Washington, DC 20224.
this publication on pages that would otherwise be blank. Although we can’t respond individually to each com-
You can help bring these children home by looking at the ment received, we do appreciate your feedback and will
photographs and calling 800-THE-LOST (800-843-5678) consider your comments and suggestions as we revise
if you recognize a child. our tax forms, instructions, and publications. Don’t send
tax questions, tax returns, or payments to the above ad-
dress.
Getting answers to your tax questions. If you have
Introduction
a tax question not answered by this publication or the How
The purpose of this publication is to provide information To Get Tax Help section at the end of this publication, go
on figuring and claiming the deduction for business use of to the IRS Interactive Tax Assistant page at IRS.gov/
your home. The term “home” includes a house, apartment, Help/ITA where you can find topics by using the search
condominium, mobile home, boat, or similar property that feature or viewing the categories listed.
provides basic living accommodations. It also includes
Getting tax forms, instructions, and publications.
structures on the property, such as an unattached garage,
Go to IRS.gov/Forms to download current and prior-year
studio, barn, or greenhouse. However, it does not include
forms, instructions, and publications.
any part of your property used exclusively as a hotel, mo-
tel, inn, or similar establishment. Ordering tax forms, instructions, and publications.
Qualifying for a Deduction gives the requirements for Go to IRS.gov/OrderForms to order current forms, instruc-
qualifying to deduct expenses for the business use of your tions, and publications; call 800-829-3676 to order
home (including special rules for storing inventory or prod- prior-year forms and instructions. The IRS will process
uct samples). For special rules that apply to daycare pro- your order for forms and publications as soon as possible.
viders, see Daycare Facility. Don’t resubmit requests you’ve already sent us. You can
After you determine that you qualify for the deduction, get forms and publications faster online.
Figuring the Deduction explains the expenses you can de-
duct using either your actual expenses or the simplified Useful Items
method. The simplified method is an alternative to calcu- You may want to see:
lating and substantiating actual expenses.
Where To Deduct explains where a self-employed per- Publication
son or partner will report the deduction.
This publication also includes information on the follow- 523 523 Selling Your Home
ing. 551 551 Basis of Assets
• Selling a home that was used partly for business.
583 583 Starting a Business and Keeping Records
• Deducting expenses for furniture and equipment used
in your business. 946 946 How To Depreciate Property

• Records you should keep. Form (and Instructions)
Finally, this publication contains worksheets to help you Schedule C (Form 1040) Schedule C (Form 1040) Profit or Loss From
figure the amount of your deduction if you use your home
in your farming business and you are filing Schedule F Business
(Form 1040) or you are a partner and the use of your 4562 4562 Depreciation and Amortization
home resulted in unreimbursed ordinary and necessary
expenses that are trade or business expenses under sec- 8829 8829 Expenses for Business Use of Your Home
tion 162 and that you are required to pay under the part-
nership agreement. If you used your home for business
and you are filing Schedule C (Form 1040), you will use ei- Qualifying for a Deduction
ther Form 8829 or the Simplified Method Worksheet in
your Instructions for Schedule C. Generally, you cannot deduct items related to your home,
The rules in this publication apply to individuals. such as mortgage interest, real estate taxes, utilities,
If you need information on deductions for renting out maintenance, rent, depreciation, or property insurance, as
your property, see Pub. 527, Residential Rental Property business expenses. However, you may be able to deduct
(Including Rental of Vacation Homes). expenses related to the business use of part of your home
if you meet specific requirements. Even then, the deducti-
ble amount of these types of expenses may be limited.

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Use this section and Figure A to decide if you can deduct • Your home is the only fixed location of your trade or
expenses for the business use of your home. business.
To qualify to deduct expenses for business use of your • You use the storage space on a regular basis.
home, you must use part of your home: • The space you use is a separately identifiable space
• Exclusively and regularly as your principal place of suitable for storage.
business (see Principal Place of Business, later);
Example. Your home is the only fixed location of your
• Exclusively and regularly as a place where you meet business of selling mechanics' tools at retail. You regularly
or deal with patients, clients, or customers in the nor- use half of your basement for storage of inventory and
mal course of your trade or business; product samples. You sometimes use the area for per-
• In the case of a separate structure that is not attached sonal purposes. The expenses for the storage space are
to your home, in connection with your trade or busi- deductible even though you do not use this part of your
ness; basement exclusively for business.

• On a regular basis for certain storage use (see Stor-
age of inventory or product samples, later); Regular Use

• For rental use (see Pub. 527); or To qualify under the regular use test, you must use a spe-
• As a daycare facility (see Daycare Facility, later). cific area of your home for business on a regular basis. In-
cidental or occasional business use is not regular use. You
must consider all facts and circumstances in determining
Exclusive Use whether your use is on a regular basis.
To qualify under the exclusive use test, you must use a
specific area of your home only for your trade or business. Trade or Business Use
The area used for business can be a room or other sepa-
To qualify under the trade-or-business-use test, you must
rately identifiable space. The space does not need to be
use part of your home in connection with a trade or busi-
marked off by a permanent partition.
ness. If you use your home for a profit-seeking activity that
You do not meet the requirements of the exclusive use is not a trade or business, you cannot take a deduction for
test if you use the area in question both for business and its business use.
for personal purposes.
Example. You use part of your home exclusively and
Example. You are an attorney and use a den in your regularly to read financial periodicals and reports, clip
home to write legal briefs and prepare clients' tax returns. bond coupons, and carry out similar activities related to
Your family also uses the den for recreation. The den is your own investments. You do not make investments as a
not used exclusively in your trade or business, so you can- broker or dealer. So, your activities are not part of a trade
not claim a deduction for the business use of the den. or business and you cannot take a deduction for the busi-
ness use of your home.
Exceptions to Exclusive Use
Principal Place of Business
You do not have to meet the exclusive use test if either of
the following applies. You can have more than one business location, including
your home, for a single trade or business. To qualify to de-
• You use the part of your home in question for the stor-
duct the expenses for the business use of your home un-
age of inventory or product samples (discussed next).
der the principal place of business test, your home must
• You use the part of your home in question as a day- be your principal place of business for that trade or busi-
care facility (discussed later under Daycare Facility). ness. To determine whether your home is your principal
place of business, you must consider:
Note. With the exception of these two uses, any por-
tion of the home used for business purposes must meet • The relative importance of the activities performed at
the exclusive use test. each place where you conduct business, and
• The amount of time spent at each place where you
Storage of inventory or product samples. If you use conduct business.
part of your home for storage of inventory or product sam-
ples, you can deduct expenses for the business use of Your home office will qualify as your principal place of
your home without meeting the exclusive use test. How- business if you meet the following requirements.
ever, you must meet all the following tests.
• You use it exclusively and regularly for administrative
• You sell products at wholesale or retail as your trade or or management activities of your trade or business.
business.
• You have no other fixed location where you conduct
• You keep the inventory or product samples in your substantial administrative or management activities of
home for use in your trade or business. your trade or business.

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Figure A. Can You Deduct Business Use of the Home Expenses? Do not use this chart if you use your home for the storage of
inventory or product samples, or to operate a daycare facility. See Exceptions to Exclusive Use, earlier, and Daycare Facility, later.

Start Here:
Is part of your home
No used in connection with
a trade or business?
Yes

Yes Are you using the part of
your home as an employee?
No

No Is the use regular
and exclusive?
Yes

Is it your principal place Yes
of business?
No

Do you meet patients,
clients, or customers in Yes
your home?
No

No Is it a separate Yes
No deduction structure? Deduction allowed

If, after considering your business locations, your home • You conduct administrative or management activities
cannot be identified as your principal place of business, at places that are not fixed locations of your business,
you cannot deduct home office expenses. However, see such as in a car or a hotel room.
the later discussions under Place To Meet Patients, Cli- You occasionally conduct minimal administrative or
•
ents, or Customers and Separate Structure for other ways management activities at a fixed location outside your
to qualify to deduct home office expenses. home.
Administrative or management activities. There are • You conduct substantial nonadministrative or nonma-
many activities that are administrative or managerial in na- nagement business activities at a fixed location out-
ture. The following are a few examples. side your home. (For example, you meet with or pro-
• Billing customers, clients, or patients. vide services to customers, clients, or patients at a
fixed location of the business outside your home.)
• Keeping books and records.
• You have suitable space to conduct administrative or
• Ordering supplies. management activities outside your home, but choose
• Setting up appointments. to use your home office for those activities instead.

• Forwarding orders or writing reports. Example 1. Sid is a self-employed plumber. Most of
Administrative or management activities performed Sid's time is spent at customers' homes and offices instal-
at other locations. The following activities performed by ling and repairing plumbing. Sid has a small office at
you or others will not disqualify your home office from be- home that is used exclusively and regularly for the admin-
ing your principal place of business. istrative or management activities of the plumbing busi-
ness, such as phoning customers, ordering supplies, and
• You have others conduct your administrative or man- keeping the books.
agement activities at locations other than your home. Sid writes up estimates and records of work completed
(For example, another company does your billing from at the customers' premises. Sid does not conduct any
its place of business.) substantial administrative or management activities at any

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fixed location other than their home office. Sid does not do fixed location where substantial administrative or manage-
direct billing. Sid uses a local bookkeeping service to bill ment activities for this business are conducted. Taylor’s
their customers. choice to use their home office instead of the one provi-
Sid's home office qualifies as their principal place of ded by their hospital does not disqualify their home office
business for deducting expenses. Sid uses the home of- from being their principal place of business. Taylor’s per-
fice for the administrative or managerial activities of the formance of substantial nonadministrative or nonmanage-
plumbing business and has no other fixed location where ment activities at fixed locations outside their home also
these administrative or managerial activities are conduc- does not disqualify their home office from being their prin-
ted. Sid’s choice to have billing done by another company cipal place of business. Taylor meets all the qualifications,
does not disqualify the home office from being their princi- including principal place of business, so the expenses
pal place of business. Sid meets all the qualifications, in- (subject to certain limitations, explained later) can be de-
cluding principal place of business, so the expenses (sub- ducted for the business use of the home.
ject to certain limitations, explained later) can be deducted
for the business use of the home. More Than One Trade or Business
Example 2. Alex is a self-employed sales representa-
The same home office can be the principal place of busi-
tive for several different product lines. Alex has an office in
ness for two or more separate business activities.
their home that they use exclusively and regularly to set up
Whether your home office is the principal place of busi-
appointments and write up orders and other reports for the
ness for more than one business activity must be deter-
products Alex sells. Alex occasionally writes up orders
mined separately for each of your trade or business activi-
and sets up appointments from their hotel room while
ties. You must use the home office exclusively and
away on business overnight.
regularly for one or more of the following purposes.
Alex’s business is selling products to customers at vari-
ous locations throughout their assigned territory. To make • As the principal place of business for one or more of
these sales, Alex regularly visits customers to explain the your trades or businesses.
available products and take orders. • As a place to meet or deal with patients, clients, or
Alex's home office qualifies as their principal place of customers in the normal course of one or more of your
business for deducting expenses for its use. Alex con- trades or businesses.
ducts administrative or management activities there and
they have no other fixed location where substantial admin- • If your home office is a separate structure, in connec-
istrative or management activities are conducted. The fact tion with one or more of your trades or businesses.
that Alex conducts some administrative or management
activities in a hotel room (not a fixed location) does not You can use your home office for more than one trade
disqualify the home office from being their principal place or business activity, but you cannot use it for any activities
of business. Alex meets all the qualifications, including that are not related to a trade or business.
principal place of business, so the expenses (subject to
certain limitations, explained later) can be deducted for Place To Meet Patients, Clients, or
the business use of the home.
Customers
Example 3. Taylor is a self-employed anesthesiolo-
gist. Taylor spends the majority of their time administering If you meet or deal with patients, clients, or customers in
anesthesia and postoperative care in three local hospitals. your home in the normal course of your business, even
One of the hospitals provides a small shared office where though you also carry on business at another location, you
Taylor could conduct administrative or management activi- can deduct your expenses for the part of your home used
ties. exclusively and regularly for business if you meet both the
Taylor very rarely uses the office the hospital provides following tests.
but instead uses a room at home that has been converted • You physically meet with patients, clients, or custom-
to an office. Taylor uses this room exclusively and regu- ers on your premises.
larly to conduct all the following activities.
• Their use of your home is substantial and integral to
• Contacting patients, surgeons, and hospitals regard- the conduct of your business.
ing scheduling.
Doctors, dentists, attorneys, and other professionals
• Preparing for treatments and presentations.
who maintain offices in their homes will generally meet
• Maintaining billing records and patient logs. this requirement.

• Satisfying continuing medical education requirements. Using your home for occasional meetings and tele-
• Reading medical journals and books. phone calls will not qualify you to deduct expenses for the
Taylor’s home office qualifies as their principal place of business use of your home.

business for deducting expenses for its use. Taylor con- The part of your home you use exclusively and regularly
ducts administrative or management activities for their to meet patients, clients, or customers does not have to be
business as an anesthesiologist there and at no other your principal place of business.

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Example. Sam, a self-employed attorney, works 3 Expenses related to tax-exempt income. Generally,
days a week in their office, then works 2 days a week at you cannot deduct expenses that are related to tax-ex-
home, in a home office used only for business. Sam regu- empt allowances. However, if you receive a tax-exempt
larly meets clients there. The home office qualifies for a parsonage allowance or a tax-exempt military allowance,
business deduction because Sam meets clients there in your expenses for mortgage interest and real estate taxes
the normal course of their business. are deductible under the normal rules. No deduction is al-
lowed for other expenses related to the tax-exempt allow-
Separate Structure ance.
If your housing is provided free of charge and the value
You can deduct expenses for a separate free-standing of the housing is tax exempt, you cannot deduct the rental
structure, such as a studio, workshop, garage, or barn, if value of any portion of the housing.
you use it exclusively and regularly for your business. The
structure does not have to be your principal place of busi- Actual Expenses
ness or a place where you meet patients, clients, or cus-
tomers. You must divide the expenses of operating your home be-
tween personal and business use. The part of a home op-
Example. Bobbie operates a floral shop in town. Bob- erating expense you can use to figure your deduction de-
bie grows the plants for their shop in a greenhouse loca- pends on both of the following.
ted at home. Bobbie uses the greenhouse exclusively and Whether the expense is direct, indirect, or unrelated.
•
regularly for their business, so Bobbie can deduct the ex-
penses for its use (subject to certain limitations, described • The percentage of your home used for business.
later).
Table 1 describes the types of expenses you may have
and the extent to which they are deductible.

Figuring the Deduction Table 1. Types of Expenses
After you determine that you meet the tests under Qualify- Expense Description Deductibility
ing for a Deduction, you can begin to figure how much you Direct Expenses only for Deductible in full.*
can deduct. When figuring the amount you can deduct for the business part
the business use of your home, you will use either your ac- of your home.
tual expenses or a simplified method. Examples: Exception:
Painting or repairs May be only partially
Electing to use the simplified method. The simplified only in the area deductible in a daycare
method is an alternative to the calculation, allocation, and used for business. facility. See Daycare
substantiation of actual expenses. You choose whether or Facility, later.
not to figure your deduction using the simplified method Indirect Expenses for Deductible based on the
each tax year. See Using the Simplified Method, later. keeping up percentage of your home
and running your used for business.*
entire home.
Using Actual Expenses Examples:
Insurance,
If you do not or cannot elect to use the simplified method utilities, and
for a home, you will figure your deduction for that home general repairs.
using your actual expenses. You will also need to figure Unrelated Expenses only for Not deductible.
the percentage of your home used for business and the the parts of your
limit on the deduction. home not used
for business.
If you are a partner or you use your home in your farm- Examples:
ing business and you file Schedule F (Form 1040), you Lawn care or painting
can use the Worksheet To Figure the Deduction for Busi- a room not used
ness Use of Your Home, near the end of this publication, for business.
to help you figure your deduction. If you use your home in *Subject to the deduction limit, discussed later.
a trade or business and you file Schedule C (Form 1040),
you will use Form 8829 to figure your deduction. Form 8829 and the Worksheet To Figure the De-
TIP duction for Business Use of Your Home have sep-
Part-year use. You cannot deduct expenses for the busi- arate columns for direct and indirect expenses.
ness use of your home incurred during any part of the year
you did not use your home for business purposes. For ex- Certain expenses are deductible to the extent they
ample, if you begin using part of your home for business would have been deductible as an itemized deduction on
on July 1, and you meet all the tests from that date until your Schedule A or, if claiming the standard deduction,
the end of the year, consider only your expenses for the would have increased your standard deduction had you
last half of the year in figuring your allowable deduction. not used your home for business. If the expense is

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indirect, use the business percentage of these expenses If you own your home, you cannot deduct the fair rental
to figure how much to include in your total busi- value of your home. However, see Depreciating Your
ness-use-of-the-home deduction. If you are itemizing your Home, later.
deductions on Schedule A (Form 1040), these expenses
include the following. Repairs. The cost of repairs that relate to your business,
including labor (other than your own labor), is a deductible
• Real estate taxes. expense. For example, a furnace repair benefits the entire
• Home mortgage interest. home. If you use 10% of your home for business, you can
deduct 10% of the cost of the furnace repair.
• Casualty losses attributable to a federally declared
Repairs keep your home in good working order over its
disaster.
useful life. Examples of common repairs are patching
If you are claiming the standard deduction, these expen- walls and floors, painting, wallpapering, repairing roofs
ses only include net qualified disaster losses that increase and gutters, and mending leaks. However, repairs are
your standard deduction. sometimes treated as a permanent improvement and are
not deductible. See Permanent improvements, later, under
See the Instructions for the Worksheet To Figure the Depreciating Your Home.
Deduction for Business Use of Your Home, later in this
publication, or the Instructions for Form 8829 for more in- Security system. If you install a security system that pro-
formation about figuring and deducting the business part tects all the doors and windows in your home, you can de-
of these otherwise allowable expenses. For more informa- duct the business part of the expenses you incur to main-
tion about deducting real estate taxes, see Pub. 530, Tax tain and monitor the system. You can also take a
Information for Homeowners. For more information about depreciation deduction for the part of the cost of the se-
deducting home mortgage interest, see Pub. 936, Home curity system relating to the business use of your home.
Mortgage Interest Deduction. For more information about
deducting casualty losses, see Pub. 547, Casualties, Dis- Utilities and services. Expenses for utilities and serv-
asters, and Thefts. ices, such as electricity, gas, trash removal, and cleaning
services, are primarily personal expenses. However, if you
Other expenses are deductible only if you use your use part of your home for business, you can deduct the
home for business. If the expense is indirect, use the busi- business part of these expenses. Generally, the business
ness percentage of these expenses to figure how much to percentage for utilities is the same as the percentage of
include in your total business-use-of-the-home deduction. your home used for business.
These expenses generally include (but are not limited to) Telephone. The basic local telephone service charge,
the following. including taxes, for the first telephone landline into your
• Casualty losses not attributable to a federally declared home is a nondeductible personal expense. However,
disaster. charges for business long-distance phone calls on that
line, as well as the cost of a second line into your home
• Depreciation (discussed under Depreciating Your used exclusively for business, are deductible business ex-
Home, later). penses. Do not include these expenses as a cost of using
• Insurance. your home for business. Deduct these charges separately
on the appropriate form or schedule. For example, if you
• Rent paid for the use of property you do not own but file Schedule C (Form 1040), deduct these expenses on
use in your trade or business. line 25, Utilities (instead of line 30, Expenses for business
• Repairs. use of your home).
• Security system.
Depreciating Your Home
• Utilities and services. (But see Telephone, later, for dif-
ferent rules that apply to telephone expenses.) If you own your home and qualify to deduct expenses for
its business use, you can claim a deduction for deprecia-
Insurance. You can deduct the cost of insurance that tion. Depreciation is an allowance for the wear and tear on
covers the business part of your home. However, if your the part of your home used for business. You cannot de-
insurance premium gives you coverage for a period that preciate the cost or value of the land. You recover its cost
extends past the end of your tax year, you can deduct only when you sell or otherwise dispose of the property.
the business percentage of the part of the premium that
gives you coverage for your tax year. You can deduct the Before you figure your depreciation deduction, you
business percentage of the part that applies to the follow- need to know the following information.
ing year in that year.
• The month and year you started using your home for
Rent. If you rent the home you occupy and meet the re- business.
quirements for business use of the home, you can deduct • The adjusted basis and fair market value of your home
part of the rent you pay. To figure your deduction, multiply (excluding land) at the time you began using it for
your rent payments by the percentage of your home used business.
for business.

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• The cost of any improvements before and after you 2023, continue to use the same depreciation method you
began using the property for business. used in past tax years. However, if you figured your deduc-
• The percentage of your home used for business. See tion for business use of the home using the simplified
Business Percentage, later. method in a prior year, you will need to use the optional
depreciation table for modified accelerated cost recovery
Adjusted basis defined. The adjusted basis of your system (MACRS) property. See Pub. 946 for the optional
home is generally its cost, plus the cost of any permanent depreciation tables. For more information about the simpli-
improvements you made to it, minus any casualty losses fied method, see Revenue Procedure 2013-13, 2013-06
or depreciation deducted in earlier tax years. For a discus- I.R.B. 478, available at IRS.gov/irb/
sion of adjusted basis, see Pub. 551, Basis of Assets. 2013-06_IRB#RP-2013-13.
If you began using your home for business for the first
Permanent improvements. A permanent improve- time in 2023, depreciate the business part as nonresiden-
ment increases the value of property, adds to its life, or tial real property under MACRS. Under MACRS, nonresi-
gives it a new or different use. Examples of improvements dential real property is depreciated using the straight line
are replacing electric wiring or plumbing, adding a new method over 39 years. For more information on MACRS
roof or addition, paneling, or remodeling. and other methods of depreciation, see Pub. 946.
You must carefully distinguish between repairs and im- To figure the depreciation deduction, you must first fig-
provements. See Repairs, earlier, under Actual Expenses. ure the part of the cost of your home that can be depreci-
You must also keep accurate records of these expenses. ated (depreciable basis). The depreciable basis is figured
These records will help you decide whether an expense is by multiplying the percentage of your home used for busi-
a deductible or a capital (added to the basis) expense. ness by the smaller of the following.
However, if you make repairs as part of an extensive re-
modeling or restoration of your home, the entire job is an • The adjusted basis of your home (excluding land) on
improvement. the date you began using your home for business.
• The fair market value of your home (excluding land) on
Example. You buy an older home and fix up two rooms the date you began using your home for business.
as a beauty salon. You patch the plaster on the ceilings
and walls, paint, repair the floor, install an outside door, Depreciation table. If 2023 was the first year you
and install new wiring, plumbing, and other equipment. used your home for business, you can figure your 2023
Normally, the patching, painting, and floor work are repairs depreciation for the business part of your home by using
and the other expenses are permanent improvements. the appropriate percentage from the following table.
However, because the work gives your property a new
use, the entire remodeling job is a permanent improve- Table 2. MACRS Percentage Table for
ment and its cost is added to the basis of the property. You 39-Year Nonresidential Real
cannot deduct any portion of it as a repair expense. Property
Adjusting for depreciation deducted in earlier
Month First Used for Business Percentage To Use
years. Decrease the basis of your property by the depre-
ciation you deducted, or could have deducted, on your tax 1 2.461%
returns under the method of depreciation you properly se- 2 2.247%
lected. If you deducted less depreciation than you could 3 2.033%
have under the method you selected, decrease the basis 4 1.819%
by the amount you could have deducted under that 5 1.605%
method. If you did not deduct any depreciation, decrease
the basis by the amount you could have deducted. 6 1.391%
If you deducted more depreciation than you should 7 1.177%
have, decrease your basis by the amount you should have 8 0.963%
deducted, plus the part of the excess depreciation you de- 9 0.749%
ducted that actually decreased your tax liability for any 10 0.535%
year.
11 0.321%
If you deducted the incorrect amount of depreciation,
see Pub. 946, How To Depreciate Property. 12 0.107%

Fair market value defined. The fair market value of your Multiply the depreciable basis of the business part of
home is the price at which the property would change your home by the percentage from the table for the first
hands between a buyer and a seller, neither having to buy month you use your home for business. See Pub. 946 for
or sell, and both having reasonable knowledge of all nec- the percentages for the remaining tax years of the recov-
essary facts. Sales of similar property, on or about the ery period.

date you begin using your home for business, may be Example. In May, Frankie began to use one room at
helpful in determining the property's fair market value. home exclusively and regularly to meet clients. This room
Figuring the depreciation deduction for the current is 8% of the square footage of the home. Frankie bought
year. If you began using your home for business before their home in 2008 for $125,000. Frankie determined from

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the property tax records that the adjusted basis in the Use lines 1–7 of Form 8829, or lines 1–3 on the
house (exclusive of land) is $115,000. In May, the house TIP Worksheet To Figure the Deduction for Business
had a fair market value of $165,000. Frankie multiplies the Use of Your Home (near the end of this publica-
adjusted basis of $115,000 (which is less than the fair tion) to figure your business percentage.
market value) by 8%. The result is $9,200, the depreciable
basis for the business part of the house.
Frankie files their return based on the calendar year. Deduction Limit
May is the fifth month of this tax year. Frankie multiplies
the depreciable basis of $9,200 by 1.605% (0.01605), the If your gross income from the business use of your home
percentage from the table for the fifth month. Frankie’s de- equals or exceeds your total business expenses (including
preciation deduction is $147.66. depreciation), you can deduct all your business expenses
related to the use of your home.
Depreciating permanent improvements. Add the costs
of permanent improvements made before you began us- If your gross income from the business use of your
ing your home for business to the basis of your property. home is less than your total business expenses, your de-
Depreciate these costs as part of the cost of your home, duction for certain expenses for the business use of your
as explained earlier. The costs of improvements made af- home is limited.
ter you begin using your home for business (that affect the
business part of your home, such as a new roof) are de- Your deduction of otherwise nondeductible expenses,
preciated separately. Multiply the cost of the improvement such as insurance, utilities, and depreciation of your home
by the business-use percentage and depreciate the result (with depreciation of your home taken last), that are allo-
over the recovery period that would apply to your home if cable to the business, is limited to the gross income from
you began using it for business at the same time as the the business use of your home minus the sum of the fol-
improvement. For improvements made this year, the re- lowing.
covery period is 39 years. For the percentage to use for 1. The business part of expenses you could deduct even
the first year, see Table 2. For more information on recov- if you did not use your home for business (such as
ery periods, see Pub. 946. mortgage interest, real estate taxes, and casualty los-
ses attributable to a federally declared disaster if you
Business Percentage itemize deductions on Schedule A (Form 1040) or net
qualified disaster losses if you claim the standard de-
To find the business percentage, compare the size of the duction).
part of your home that you use for business to your whole
house. Use the resulting percentage to figure the business 2. The business expenses that relate to the business ac-
part of the expenses for operating your entire home. tivity in the home (for example, business phone, sup-
plies, and depreciation on equipment), but not to the
You can use any reasonable method to determine the use of the home itself.
business percentage. The following are two commonly If you are self-employed, do not include in (2) above your
used methods for figuring the percentage. deduction for one-half of your self-employment tax.
1. Divide the area (length multiplied by the width) used
Carryover of unallowed expenses. If your business ex-
for business by the total area of your home.
penses related to the home are greater than the current
2. If the rooms in your home are all about the same size, year's limit, you can carry over the excess to the next year
you can divide the number of rooms used for business in which you use actual expenses. They are subject to the
by the total number of rooms in your home. deduction limit for that year, whether or not you live in the
same home during that year.
Example 1.
Figuring the deduction limit and carryover. If you are
• Your office is 240 square feet (12 feet × 20 feet).
a partner or you file Schedule F (Form 1040), use the
• Your home is 1,200 square feet. Worksheet To Figure the Deduction for Business Use of
• Your office is 20% (240 ÷ 1,200) of the total area of Your Home, near the end of this publication. If you file
your home. Schedule C (Form 1040), figure your deduction limit and
carryover on Form 8829.
• Your business percentage is 20%.
Example. You meet the requirements for deducting ex-
Example 2. penses for the business use of your home. You use 20%
• You use one room in your home for business. of your home for business. You are itemizing your deduc-
tions on Schedule A (Form 1040) and your home mort-
• Your home has 10 rooms, all about equal size. gage interest and total state and local taxes would not be
• Your office is 10% (1 ÷ 10) of the total area of your limited on your Schedule A if you had not used your home
home. for business. In 2023, your business expenses and the ex-
penses for the business use of your home are deducted
• Your business percentage is 10%.
from your gross income in the following order.

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Gross income from business. . . . . . . . . . . . . . . . . . . $6,000 also cannot deduct any depreciation (including any addi-
Minus: tional first-year depreciation) or section 179 expense for
Deductible mortgage interest the portion of the home that is used for a qualified busi-
and real estate taxes (20%) . . . . . . . . . . . . . . . . . 3,000 ness use. The depreciation deduction allowable for that
Business expenses not related to the use of your home portion of the home is deemed to be zero for a year you
(100%) (business phone, supplies, and depreciation on
equipment). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000 use the simplified method. If you figure your deduction for
Deduction limit. . . . . . . . . . . . . . . . . . . . . . . . . . . $1,000 business use of the home using actual expenses in a sub-
Minus other expenses allocable to business use of home: sequent year, you will have to use the appropriate optional
Maintenance, insurance, and utilities (20%). . . . . . . . 800 depreciation table for MACRS to figure your depreciation.
Depreciation allowed (20%) . . . . . . . . . . . . . . . . . 200
Other expenses up to the deduction limit. . . . . . . . . . . $1,000 More information. For more information about claim-
Depreciation carryover to 2024 ($1,600 − $200) ing depreciation in a subsequent year, see Revenue Pro-
(subject to deduction limit in 2024). . . . . . . . . . . . . . . $1,400 cedure 2013-13, 2013-06 I.R.B. 478, available at
IRS.gov/irb/2013-06_IRB#RP-2013-13. See Pub. 946 for
You can deduct all of the business part of your deducti- the optional depreciation tables.
ble mortgage interest and real estate taxes ($3,000). You
can also deduct all of your business expenses not related Although you cannot deduct any depreciation or
to the use of your home ($2,000). Additionally, you can de- TIP section 179 expense for the portion of your home
duct all of the business part of your expenses for mainte- used for a qualified business use, you may still
nance, insurance, and utilities, because the total ($800) is claim depreciation or the section 179 expense deduction
less than the $1,000 deduction limit. Your deduction for on other assets used in the business (for example, furni-
depreciation for the business use of your home is limited ture and equipment).
to $200 ($1,000 minus $800) because of the deduction
limit. You can carry over the $1,400 balance and add it to Expenses deductible without regard to business use.
your depreciation for 2024, subject to your deduction limit When using the simplified method, treat as personal ex-
in 2024. penses your mortgage interest, real estate taxes, and
casualty losses. If you also rent part of your home, you
More than one place of business. If part of the gross must still allocate these expenses between rental use and
income from your trade or business is from the business personal use (for this purpose, personal use includes
use of part of your home and part is from a place other business use reported using the simplified method).
than your home, you must determine the part of your gross
income from the business use of your home before you No deduction of carryover of actual expenses. If you
figure the deduction limit. In making this determination, used actual expenses to figure your deduction for busi-
consider the time you spend at each location, the busi- ness use of the home in a prior year and your deduction
ness investment in each location, and any other relevant was limited, you cannot deduct the disallowed amount
facts and circumstances. carried over from the prior year during a year you figure
your deduction using the simplified method. Instead, you
If your home office qualifies as your principal will continue to carry over the disallowed amount to the
TIP place of business, you can deduct your daily next year that you use actual expenses to figure your de-
transportation costs between your home and an- duction.
other work location in the same trade or business. For
more information on transportation costs, see Pub. 463,
Travel, Gift, and Car Expenses. Electing the Simplified Method

You choose whether or not to figure your deduction using
the simplified method each tax year. Make the election for
Using the Simplified Method
a home by using the simplified method to figure the de-
The simplified method is an alternative to the calculation, duction for the qualified business use of that home on a
allocation, and substantiation of actual expenses. In most timely filed, original federal income tax return. An election
cases, you will figure your deduction by multiplying $5, the for a tax year, once made, is irrevocable. A change from
prescribed rate, by the area of your home used for a quali- using the simplified method in one year to actual expen-
fied business use. The area you use to figure your deduc- ses in a succeeding tax year, or vice versa, is not a
tion is limited to 300 square feet. See Simplified Amount, change in method of accounting and does not require the
later, for information about figuring the amount of the de- consent of the Commissioner.
duction.
Shared use. If you share your home with someone else
For more information about the simplified method, see who also uses the home in a business that qualifies for
Revenue Procedure 2013-13, 2013-06 I.R.B. 478, availa- this deduction, each of you makes your own election.
ble at IRS.gov/irb/2013-06_IRB#RP-2013-13.
More than one qualified business use. If you conduct
Actual expenses and depreciation of your home. If more than one business that qualifies for this deduction in
you elect to use the simplified method, you cannot deduct your home, your election to use the simplified method ap-
any actual expenses for the business except for business plies to all your qualified business uses of that home.
expenses that are not related to the use of the home. You

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More than one home. If you used more than one home used in conducting the business and 300 square feet.
in your business during the year (for example, you moved Your allowable area may be smaller if you conducted the
during the year), you can elect to use the simplified business as a qualified joint venture with your spouse, the
method for only one of the homes. You must figure the de- area used by the business was shared with another quali-
duction for any other home using actual expenses. fied business use, you used the home for the business for
only part of the year, or the area used by the business
Simplified Amount changed during the year. You can use the Area Adjust-
ment Worksheet (for simplified method) , near the end of
Your deduction for the qualified business use of a home is this publication, to help you figure your allowable area for
the sum of each amount you figure for a separate qualified a qualified business use.
business use of your home. To figure your deduction for
Area used by a qualified joint venture. If the quali-
the business use of a home using the simplified method,
fied business use of the home is also a qualified joint ven-
you will need to know the following information for each
ture, you and your spouse will figure the deduction for the
qualified business use of the home.
business use separately. Split the actual area used in con-
• The allowable area of your home used in conducting ducting business between you and your spouse in the
the business. If you did not conduct the business for same manner you split your other tax attributes. Then,
the entire year in the home or the area changed during each spouse will figure the allowable area separately. For
the year, you will need to know the allowable area you more information about qualified joint ventures, see Quali-
used and the number of days you conducted the busi- fied Joint Venture in the Instructions for Schedule C.
ness for each month.
Shared use. If you share your home with someone
• The gross income from the business use of your else who uses the home to conduct business that also
home. qualifies for this deduction, you may not include the same
• The amount of the business expenses that are not re- square feet to figure your deduction as the other person.
lated to the use of your home. You must allocate the shared space between you and the
other person in a reasonable manner.
• If the qualified business use is for a daycare facility
that uses space in your home on a regular (but not ex- Example. Lindsey and Tracy are roommates. Lindsey
clusive) basis, you will need to know the percentage of uses 300 square feet of their home for a qualified business
time that part of your home is used for daycare. use. Tracy uses 200 square feet of their home for a sepa-
rate qualified business use. Lindsey and Tracy both share
To figure the amount you can deduct for qualified busi- 100 square feet for their respective qualified businesses in
ness use of your home using the simplified method, follow their mutual home. In addition to the portion that they do
these three steps. not share, Lindsey and Tracy can both claim 50 of the 100
1. Multiply the allowable area by $5 (or less than $5 if the square feet or divide the 100 square feet between them in
qualified business use is for a daycare that uses any reasonable manner. If divided evenly, Lindsey could
space in your home on a regular, but not exclusive, claim 250 square feet using the simplified method and
basis). See Allowable area and Space used regularly Tracy could claim 150 square feet.
for daycare, later. More than one qualified business use. If you con-
2. Subtract the expenses from the business that are not duct more than one business qualifying for the deduction,
related to the use of the home from the gross income you are limited to a maximum of 300 square feet for all of
related to the business use of the home. If these ex- the businesses. Allocate the actual square footage used
penses are greater than the gross income from the (up to the maximum of 300 square feet) among your quali-
business use of the home, then you cannot take a de- fied business uses in a reasonable manner. However, do
duction for this business use of the home. See Gross not allocate more square feet to a qualified business use
income limitation, later. than you actually use for that business.
3. Take the smaller of the amounts from (1) and (2). This Rental use. The simplified method does not apply to
is the amount you can deduct for this qualified busi- rental use. A rental use that qualifies for the deduction
ness use of your home using the simplified method. must be figured using actual expenses. If the rental use
and a qualified business use share the same area, you will
If you are a partner or you use your home in your farm- have to allocate the actual area used between the two
ing business and file Schedule F (Form 1040), you can uses. You cannot use the same area to figure a deduction
use the Simplified Method Worksheet, near the end of this for the qualified business use as you are using to figure
publication, to help you figure your deduction. If you use the deduction for the rental use.
your home in a trade or business and you file Schedule C
(Form 1040), you will use the Simplified Method Work- Part-year use or area changes (for simplified
sheet in your Instructions for Schedule C to figure your de- method only). If your qualified business use was for a
duction. portion of the year (for example, a seasonal business, a
business that begins during the year, or you moved during
Allowable area. In most cases, the allowable area is the the year) or you changed the square footage of your quali-
smaller of the actual area (in square feet) of your home fied business use, your deduction is limited to the average

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monthly allowable square footage. You calculate the aver- deduct business expenses that are unrelated to the use of
age monthly allowable square footage by adding the the home. See Where To Deduct, later. Examples of busi-
amount of allowable square feet you used in each month ness expenses that are unrelated to the use of the home
and dividing the sum by 12. When determining the aver- are advertising, wages, supplies, dues, and depreciation
age monthly allowable square footage, you cannot take for equipment.
more than 300 square feet into account for any 1 month.
Additionally, if your qualified business use was less than Space used regularly for daycare. If you do not use the
15 days in a month, you must use -0- for that month. area of your home exclusively for daycare, you must re-
duce the prescribed rate (maximum $5 per square foot)
Example 1. Jay files their federal income tax return on before figuring your deduction. The reduced rate will equal
a calendar year basis. On July 20, Jay began using 420 the prescribed rate times a fraction. The numerator of the
square feet at their home for a qualified business use. Jay fraction is the number of hours that the space was used
continued to use 420 square feet of their home until the during the year for daycare and the denominator is the to-
end of the year. The average monthly allowable square tal number of hours during the year that the space was
footage is 125 square feet, which is figured using 300 available for all uses. You can use the Daycare Facility
square feet for each month, August through December, Worksheet (for simplified method), near the end of this
divided by the number of months in the year ((0 + 0 + 0 + 0 publication, to help you figure the reduced rate.
+ 0 + 0 + 0 + 300 + 300 + 300 + 300 + 300)/12).
If you used at least 300 square feet for daycare
Example 2. Jessie files their federal tax return on a TIP regularly and exclusively during the year, then you
calendar year basis. On April 20, Jessie began using 100 do not need to reduce the prescribed rate or com-
square feet of their home for a qualified business use. On plete the Daycare Facility Worksheet.
August 5, Jessie expanded the area of qualified use to
330 square feet. Jessie continued to use the 330 square
feet until the end of the year. The average monthly allowa-
ble square footage is 150 square feet, which is figured us- Daycare Facility
ing 100 square feet for May through July and 300 square
If you use space in your home on a regular basis for pro-
feet for August through December, divided by the number
viding daycare, you may be able to claim a deduction for
of months in the year ((0 + 0 + 0 + 0 + 100 + 100 +100 +
that part of your home even if you use the same space for
300 + 300 + 300 + 300 + 300)/12).
nonbusiness purposes. To qualify for this exception to the
Example 3. Guadalupe files their income tax return on exclusive use rule, you must meet both of the following re-
a calendar year basis. From January 1 through July 16, quirements.
Guadalupe used 300 square feet of their home for a quali- • You must be in the trade or business of providing day-
fied business use. On July 17, Guadalupe moved to a new care for children, persons age 65 or older, or persons
home and immediately began using 200 square feet for who are physically or mentally unable to care for them-
the same qualified business use. While preparing their tax selves.
return, Guadalupe decided to use the simplified method to
deduct the qualified business use of the first home and • You must have applied for, been granted, or be ex-
empt from having a license, certification, registration,
files a Form 8829 to deduct the qualified business use of
or approval as a daycare center or as a family or group
the second home. The average monthly allowable square
daycare home under state law. You do not meet this
footage is 175 square feet, which is figured using 300
requirement if your application was rejected or your li-
square feet for January through July, divided by the num-
cense or other authorization was revoked.
ber of months in the year ((300 + 300 + 300 + 300 + 300 +
300 + 300 + 0 + 0 + 0 + 0 + 0)/12). Figuring the deduction. If you elect to use the simplified
If you moved during the year, your average allowa- method for your home, figure your deduction as described
earlier in Using the Simplified Method under Figuring the
! ble square footage will generally be less than 300.
CAUTION Deduction.
If you are figuring your deduction using actual expen-
Gross income limitation. Your deduction for business ses and you regularly use part of your home for daycare,
use of the home is limited to an amount equal to the gross figure what part is used for daycare, as explained in Busi-
income derived from the qualified business use of the ness Percentage, earlier, under Figuring the Deduction. If
home reduced by the business deductions that are unrela- you also use that part exclusively for daycare, deduct all
ted to the use of your home. If the business deductions the allocable expenses, subject to the deduction limit, as
that are unrelated to the use of your home are greater than explained earlier.
the gross income derived from the qualified business use If the use of part of your home as a daycare facility is
of your home, then you cannot take a deduction for this regular, but not exclusive, you must figure the percentage
qualified business use of your home. of time that part of your home is used for daycare. A room
that is available for use throughout each business day and
Business expenses not related to use of the home.
that you regularly use in your business is considered to be
These expenses relate to the business activity in the
used for daycare throughout each business day. You do
home, but not to the use of the home itself. You can still

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not have to keep records to show the specific hours the for rent on line 19, column (b), and the amount paid for
area was used for business. You can use the area occa- utilities on line 21, column (b). Rene shows the total of
sionally for personal reasons. However, a room you use these expenses on line 23, column (b). For line 24, Rene
only occasionally for business does not qualify for the de- multiplies the amount on line 23, column (b), by the per-
duction. centage on line 7 and enters the result, $1,585.
To find the percentage of time you actually use Rene paid $500 to have the basement painted. The
TIP your home for business, compare the total time painting is a direct expense. However, because the base-
used for business to the total time that part of your ment was not used exclusively for daycare, Rene must
home can be used for all purposes. You can compare the multiply $500 by the percentage of time the basement was
hours of business use in a week with the number of hours used for daycare (34.25% – line 6). Rene then enters $171
in a week (168). Or, you can compare the hours of busi- (34.25% × $500) on line 20, column (a). Rene then adds
ness use for the year with the number of hours in the year line 23, column (a), and line 24 and enters $1,756 ($171 +
(8,760 in 2023). If you started or stopped using your home $1,585) on line 26. This is less than Rene’s deduction limit
for daycare in 2023, you must prorate the number of hours (line 15), so Rene can deduct the entire amount. Rene fol-
based on the number of days the home was available for lows the instructions to complete the rest of Part II and en-
daycare. ters $1,756 on lines 34 and 36. Then Rene carries the
$1,756 to line 30 of their Schedule C (Form 1040).
Example 1. Rene used the basement at home to op-
erate a daycare business for children. Rene figures the Example 2. Assume the same facts as in Example 1
business percentage of the basement as follows. except that Rene also has another room that was available
each business day for children to take naps in. Although
Square footage of the basement 1,600 Rene did not keep a record of the number of hours the
= = 50%
Square footage of the home 3,200 room was used for naps, it was used for part of each busi-
ness day. Since the room was available for business use
Rene used the basement for daycare an average of 12 during regular operating hours each business day and
hours a day, 5 days a week, for 50 weeks a year. During was used regularly in the business, it is considered used
the other 12 hours a day, the family could use the base- for daycare throughout each business day. The basement
ment. Rene figures the percentage of time the basement and room are 60% of the total area of the home. In figuring
was used for daycare as follows. Rene’s expenses, 34.25% of any direct expenses for the
basement and room are deductible. In addition, 20.55%
Number of hours used for daycare (12 x 5 x 50) 3,000 (34.25% × 60%) of their indirect expenses are deductible.
= = 34.25%
Total number of hours in the year (24 x 365) 8,760
Example 3. Assume the same facts as in Example 1
Rene can deduct 34.25% of any direct expenses for the except that Rene stopped using the home for a daycare
basement. However, because Rene’s indirect expenses facility on June 24, 2023. Rene used the basement for
are for the entire house, Rene can deduct only 17.13% of daycare an average of 12 hours a day, 5 days a week, but
the indirect expenses. Rene figures the percentage for for only 25 weeks of the year. During the other 12 hours a
their indirect expenses as follows. day, Rene’s family could still use the basement. Rene fig-
ures the percentage of time the basement was used for
Business percentage of the basement . . . . . . . . . . . . . 50% business as follows.
Multiplied by: Percentage of time used for daycare . . . . . × 34.25%
Percentage for indirect expenses. . . . . . . . . . . . . . . . 17.13% Number of hours used for daycare (12 x 5 x 25)
1,500
Total number of hours during period used (24 x = = 35.71%
4,200
Rene completes Form 8829, Part I, figuring the percent- 175)
age of the home used for business, including the percent-
age of time the basement was used. Rene can deduct 35.71% of any direct expenses for the
basement. However, because the indirect expenses are
In Part II, Rene figures their deductible expenses. Rene for the entire house, Rene can deduct only 17.86% of the
uses the following information to complete Part II. indirect expenses. Rene then figures the percentage for
their indirect expenses as follows.
Gross income from the daycare business. . . . . . . . . . . $50,000
Expenses not related to the business use of the home . . . $25,000 . . . . . . . . . . . . . 50%
Business percentage of the basement
Tentative profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . $25,000 Multiplied by: Percentage of time used for daycare . . . . . × 35.71%
Rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $8,400 Percentage for indirect expenses. . . . . . . . . . . . . . . . 17.86%
Utilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $850
Painting the basement. . . . . . . . . . . . . . . . . . . . . . . $500
Meals. If you provide food for your daycare recipients, do
Rene enters their tentative profit, $25,000, on line 8. not include the expense as a cost of using your home for
(This figure is the same as the amount on line 29 of their business. Claim it as a separate deduction on your Sched-
Schedule C (Form 1040)). ule C (Form 1040). You can never deduct the cost of food
consumed by you or your family. You can deduct as a
The expenses they paid for rent and utilities relate to
business expense 100% of the actual cost of food
their entire home. Therefore, Rene enters the amount paid

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consumed by your daycare recipients (see Standard meal rates for all your deductible food costs for eligible children
and snack rates, later, for an optional method for eligible during that tax year. However, if you use the standard
children) and generally only 50% of the cost of food con- meal and snack rates in any tax year, you can use actual
sumed by your employees. For more information on meals costs to compute the deductible cost of food in any other
that meet these requirements, see Meals in chapter 2 of tax year.
Pub. 15-B, Employer's Tax Guide to Fringe Benefits. If you use the standard meal and snack rates, you must
If you deduct the actual cost of food for your daycare maintain records to substantiate the computation of the to-
business, keep a separate record (with receipts) of your tal amount deducted for the cost of food provided to eligi-
family's food costs. ble children. The records kept should include the name of
Reimbursements you receive from a sponsor under the each child, dates and hours of attendance in the daycare,
Child and Adult Care Food Program of the Department of and the type and quantity of meals and snacks served.
Agriculture are taxable only to the extent they exceed your This information can be recorded in a log similar to the
expenses for food for eligible children. If your reimburse- one shown in Exhibit A, near the end of this publication.
ments are more than your expenses for food, show the dif- The standard meal and snack rates include beverages,
ference as income in Part I of Schedule C (Form 1040). If but do not include non-food supplies used for food prepa-
your food expenses are greater than the reimbursements, ration, service, or storage, such as containers, paper
show the difference as an expense in Part V of Sched- products, or utensils. These expenses can be claimed as
ule C (Form 1040). Do not include payments or expenses a separate deduction on your Schedule C (Form 1040).
for your own children if they are eligible for the program.
Follow this procedure even if you receive a Form
1099-MISC, Miscellaneous Information, reporting a pay- Table 3. 1
Standard Meal and Snack Rates
ment from the sponsor.
Standard meal and snack rates. If you qualify as a Location of Breakfast Lunch Dinner Snack
family daycare provider, you can use the standard meal Family
and snack rates, instead of actual costs, to compute the Daycare
deductible cost of meals and snacks provided to eligible Provider
children. For these purposes:
States other
• A family daycare provider is a person engaged in the than Alaska $1.66 $3.04 $3.04 $0.97
business of providing family daycare; and Hawaii
• Family daycare is childcare provided to eligible chil- Alaska $2.59 $4.87 $4.87 $1.52
dren in the home of the family daycare provider. The
care must be non-medical, not involve a transfer of le- Hawaii $1.91 $3.55 $3.55 $1.12
gal custody, and generally last less than 24 hours 1 The applicable rates for 2023 are the Child and Adult Care
each day; and Food Program reimbursement rates in effect on December 31,
• Eligible children are minor children receiving family 2022.
daycare in the home of the family daycare provider. El-
igible children do not include children who are full-time
or part-time residents in the home where the childcare
is provided or children whose parents or guardians are Sale or Exchange of
residents of the same home. Eligible children do not
include children who receive daycare services for per- Your Home
sonal reasons of the provider. For example, if a pro-
If you sell or exchange your home, you may be able to ex-
vider provides daycare services for a relative as a fa-
clude up to $250,000 ($500,000 for certain married per-
vor to that relative, that child is not an eligible child.
sons filing a joint return) of the gain on the sale or ex-
You can compute the deductible cost of each meal and change. In most cases, you must meet the ownership and
snack you actually purchased and served to an eligible use tests. However, even if you meet the ownership and
child during the time period you provided family daycare use tests, your home sale is not eligible for the exclusion if
using the standard meal and snack rates shown in Ta- either of the following is true.
ble 3. You can use the standard meal and snack rates for
a maximum of one breakfast, one lunch, one dinner, and • You acquired the property through a like-kind ex-
three snacks per eligible child per day. If you receive reim- change (1031 exchange) during the past 5 years.
bursement for a particular meal or snack, you can deduct • You are subject to the expatriate tax.
only the portion of the applicable standard meal or snack
rate that is more than the amount of the reimbursement. Ownership and use tests. The ownership and use tests
You can use either the standard meal and snack rates generally require that during the 5-year period ending on
or actual costs to calculate the deductible cost of food pro- the date of the sale:
vided to eligible children in the family daycare for any par- • You owned the home for at least 2 years (ownership
ticular tax year. If you choose to use the standard meal test), and
and snack rates for a particular tax year, you must use the

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• You lived in the home as your main home for at least 2           part  as  your  main  home  for  at  least  2  years  during  the 
  years (use test). The 2 years of residence can fall any-         5-year period ending on the date of the sale.
  where within the 5-year period, and it does not need to 
  be a single block of time.                                       Use  test  met  for  business  part  (no  business  use  in 
                                                                   year  of  sale). If  you  have  used  a  separate  part  of  your 
                                                                   property for business (though not in the year of sale) but 
Gain on Sale                                                       meet the use test for both the business part and the part 
                                                                   you use as a home, you do not need to treat the transac-
If you use property partly as a home and partly for busi-          tion as the sale of two properties. Also, you do not need to 
ness, the treatment of any gain on the sale varies depend-         file Form 4797. You can generally exclude gain on the en-
ing on whether the part of the property used for business          tire property.
is part of your home or separate from it.

                                                                   Depreciation
Part of Home Used for Business
                                                                   If you were entitled to deduct depreciation on the part of 
If the part of your property used for business is within your      your home used for business, you cannot exclude the part 
home, such as a room used as a home office for a busi-             of  the  gain  equal  to  any  depreciation  you  deducted  (or 
ness or rooms used to provide daycare, you do not need             could have deducted) for periods after May 6, 1997. This 
to  allocate  gain  on  the  sale  of  the  property  between  the means that when figuring the amount of gain you can ex-
business  part  of  the  property  and  the  part  used  as  a     clude, you must reduce the total gain by any depreciation 
home. In addition, you do not need to report the sale of the       allowed  or  allowable  on  the  part  of  your  home  used  for 
business part on Form 4797, Sales of Business Property.            business after May 6, 1997.
This is true whether or not you were entitled to claim any 
depreciation. However, you cannot exclude the part of any          If you can show by adequate records or other evidence 
gain equal to any depreciation allowed or allowable after          that  the  depreciation  you  actually  deducted  (the  allowed 
May 6, 1997. See Depreciation, later.                              depreciation) was less than the amount you were entitled 
                                                                   to  deduct  (the  allowable  depreciation),  the  amount  you 
Separate Part of Property Used for Business                        cannot  exclude  (and  must  subtract  from  your  total  gain 
                                                                   when figuring your exclusion) is the amount you actually 
You may have used part of your property as a home and a            deducted.
separate part of it, such as an outbuilding, for business.         You do not have to reduce the gain by any depreciation 
                                                                   you  deducted  (or  could  have  deducted)  for  a  separate 
Use  test  not  met  for  business  part. You  cannot  ex-         structure for which you cannot exclude the allocable por-
clude gain on the separate part of your property used for          tion of the gain.
business unless you owned and lived in that part of your 
property for at least 2 years during the 5-year period end-
ing on the date of the sale. If you do not meet the use test       Basis Adjustment
for the business part of the property, an allocation of the 
                                                                   If you used any part of your home for business, you must 
gain on the sale is required. For this purpose, you must al-
                                                                   adjust  the  basis  of  your  home  for  any  depreciation  that 
locate the basis of the property and the amount realized 
                                                                   was  allowable  for  its  business  use,  even  if  you  did  not 
upon its sale between the business part and the part used 
                                                                   claim it. If you deducted less depreciation than you could 
as a home. You must report the sale of the business part 
                                                                   have  under  the  method  you  properly  selected,  you  must 
on Form 4797.
                                                                   decrease the basis by the amount you could have deduc-
Use test met for business part (business use in year               ted under that method. If you deducted more depreciation 
of sale). If you used a separate part of your property for         than you should have under the method you properly se-
business in the year of sale, you should treat the sale of         lected,  you  must  decrease  the  basis  by  the  amount  you 
the property as the sale of two properties, even if you met        should have deducted, plus the part of the excess deduc-
the use test for the business part. You must report the sale       ted that actually decreased your tax liability for any year. 
of the business part on Form 4797.                                 For more information on reducing the basis of your prop-
To determine the amount to report on Form 4797, you                erty for depreciation, see Pub. 551.
must divide your selling price, selling expenses, and basis 
between  the  part  of  the  property  used  for  business  and    Reporting the Sale
the separate part used as your home. In the same way, if 
you qualify to exclude any of the gain on the business part        Do not report the 2023 sale of your main home on your tax 
of your property, also divide your maximum exclusion be-           return unless:
tween that part of the property and the separate part used         • You received a Form 1099-S, Proceeds From Real Es-
as your home.                                                        tate Transactions, for the sale or exchange;
Excluding gain on the business part of your prop-                  • You have a gain and you do not qualify to exclude all 
erty. You can generally exclude gain on the part of your             of it;
property used for business if you owned and lived in that 
                                                                   • You have a gain and choose not to exclude it; or

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• You have a loss from the sale that is deductible. Years following the year placed in service. If, in a year
after you place an item of listed property in service, you
A loss from the sale of your home, or the personal
fail to meet the more-than-50%-use test for that item of
! part of your home if it was also used for business property, you may be required to do the following.
CAUTION or to produce rental income, is not deductible.
1. Figure depreciation, beginning with the year you no
If any of these conditions apply, report the gain or loss longer use the property more than 50% for business,
as explained in the Instructions for Schedule D. using the straight line method (ADS).
If you used the home for business, you may have to use 2. Figure any excess depreciation (include any section
Form 4797 to report the sale of the business part. See the 179 deduction on the property in figuring excess de-
Instructions for Form 4797. preciation) and add it to:
a. Your gross income, and
More Information
b. The adjusted basis of your property.
This section covers only the basic rules for the sale or ex-
change of your home. For more information, see Pub. 523, For more information, see Pub. 946.
Selling Your Home.
Reporting and recordkeeping requirements. If you
use listed property in your business, you must file Form
4562 to claim a depreciation or section 179 deduction.
Business Furniture and Begin with Part V, Section A, of that form.
Equipment You cannot take any depreciation or section 179
deduction for the use of listed property unless you
This section discusses the depreciation and section 179 RECORDS can prove your business/investment use with ade-
deductions you may be entitled to take for furniture and quate records or sufficient evidence to support your own
equipment you use in your home for business. These de- statements.
ductions are available whether or not you qualify to deduct
expenses for the business use of your home. To meet the adequate records requirement, you must
maintain an account book, diary, log, statement of ex-
This section explains the different rules for each of the pense, trip sheet, or similar record or other documentary
following. evidence that is sufficient to establish business/invest-
• Listed property. ment use. For more information on what records to keep,
see Pub. 946.
• Property bought for business use.
• Personal property converted to business use.
Property Bought for Business Use

Listed Property If you bought certain property during 2023 to use in your
business, you can do any one of the following (subject to
If you use certain types of property, called listed property, the limits discussed later).
in your home, special rules apply. Listed property includes
any property of a type generally used for entertainment, • Elect a section 179 deduction for the full cost of the
recreation, and amusement (including photographic, pho- property.
nographic, and video recording equipment). • Depreciate the cost of the property.
More-than-50%-use test. If you bought listed property • Take part of the cost as a section 179 deduction and
and placed it in service during the year, you must use it depreciate the balance.
more than 50% for business to claim a section 179 deduc-
tion or an accelerated depreciation deduction. Section 179 Deduction
If your business use of listed property is 50% or less,
you cannot take a section 179 deduction and you must de- You can claim the section 179 deduction for the cost of
preciate the property using the Alternative Depreciation depreciable tangible personal property bought for use in
System (ADS) (straight line method). For more information your trade or business. You can choose how much (sub-
on ADS, see Pub. 946. ject to the limit) of the cost you want to deduct under sec-
Listed property meets the more-than-50%-use test for tion 179 and how much you want to depreciate. You can
any year if its qualified business use is more than 50% of spread the section 179 deduction over several items of
its total use. You must allocate the use of any item of listed property in any way you choose as long as the total does
property used for more than one purpose during the year not exceed the maximum allowable. You cannot take a
among its various uses. You cannot use the percentage of section 179 deduction for the basis of the business part of
investment use as part of the percentage of qualified busi- your home.
ness use to meet the more-than-50%-use test. However,
you do use the combined total of business and investment You elect the section 179 deduction by completing Part
use to figure your depreciation deduction for the property. I of Form 4562.

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More information. For more information on the section • Not take the section 179 deduction and depreciate the
179 deduction, qualifying property, the dollar limit, and the office furniture using its full cost.
business income limit, see Pub. 946 and the Instructions The furniture is 7-year property under MACRS. Kerry
for Form 4562. does not take a section 179 deduction. Kerry multiplies
$1,975 by 14.29% (0.1429) to get the MACRS deprecia-
Depreciation tion deduction of $282.23.
Use Parts II and III of Form 4562 to claim your deduction
for depreciation on property placed in service during the Personal Property Converted to
year. Do not include any costs deducted in Part I (section Business Use
179 deduction).
If you use property in your home office that was used pre-
Most business property normally used in a home office viously for personal purposes, you cannot take a section
is either 5-year or 7-year property under MACRS. 179 deduction for the property.
• 5-year property includes computers and peripheral If you began using the property for personal purposes
equipment, typewriters, calculators, adding machines, after 1980 and before 1987 and change it to business use
and copiers. in 2023, you cannot take a special depreciation allowance
for the property. However, you can depreciate it. You gen-
• 7-year property includes office furniture and fixtures erally depreciate the property under the accelerated cost
such as desks, files, and safes. recovery system (ACRS). However, if the depreciation un-
der ACRS is greater in the first year than the depreciation
Under MACRS, you generally use the half-year conven-
under MACRS, you must depreciate it under MACRS. For
tion, which allows you to deduct a half-year of deprecia-
information on ACRS, see Pub. 534, Depreciating Prop-
tion in the first year you use the property in your business.
erty Placed in Service Before 1987.
If you place more than 40% of your depreciable property
in service during the last 3 months of your tax year, you If you began using the property for personal purposes
must use the mid-quarter convention instead of the after 1986 and change it to business use in 2023, you may
half-year convention. be able to take a special depreciation allowance for the
property. You generally depreciate the property under
After you have determined the cost of the depreciable MACRS. The basis for depreciation of property changed
property (minus any section 179 deduction and special from personal to business use is the lesser of the follow-
depreciation allowance taken on the property) and ing.
whether it is 5-year or 7-year property, use the table, The adjusted basis of the property on the date of
•
shown next, to figure your depreciation if the half-year change.
convention applies.
• The fair market value of the property on the date of
Table 4. MACRS Percentage Table for 5- and change.
7-Year Property Using Half-Year If you began using the property for personal purposes
Convention before 1981 and change it to business use in 2023, depre-
ciate the property by the straight line or declining balance
Recovery Year 5-Year Property 7-Year Property method based on salvage value and useful life.
1 20.00% 14.29%
2 32.00% 24.49%
3 19.20% 17.49%
4 11.52% 12.49% Recordkeeping
5 11.52% 8.93% You do not have to use a particular method of re-
6 5.76% 8.92%
7 8.93% cordkeeping, but you must keep records that pro-
8 4.46% RECORDS vide the information needed to figure your deduc-
tions for the business use of your home. You should keep
See Pub. 946 for a discussion of the mid-quarter con- canceled checks, receipts, and other evidence of expen-
vention and for complete MACRS percentage tables. ses you paid.

Example. In June 2023, Kerry bought a desk and Your records must show the following information.
three chairs for use at their office. The total bill for the fur-
• The part of your home you use for business.
niture was $1,975. The taxable business income for the
year was $3,000 without any deduction for the office furni- • That you use part of your home exclusively and regu-
ture. Kerry can elect to do one of the following. larly for business as either your principal place of busi-
ness or as the place where you meet or deal with cli-
• Take a section 179 deduction for the full cost of the of-
ents or customers in the normal course of your
fice furniture.
business. However, see the earlier discussion, Excep-
• Take part of the cost of the furniture as a section 179 tions to Exclusive Use under Qualifying for a
deduction and depreciate the balance. Deduction.

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•  The depreciation and expenses for the business part.            Home  mortgage  interest.      The  business  portion  of 
You must keep your records for as long as they are impor-          your home mortgage interest allowed as a deduction this 
tant for any tax law. This is usually the later of the following   year will be included in the business use of the home de-
dates.                                                             duction you report on Schedule C (Form 1040), line 30, or 
                                                                   Schedule F (Form 1040), line 32. If you cannot deduct the 
•  3 years from the return due date or the date filed.             business  portion  of  your  home  mortgage  interest  in  full 
•  2 years after the tax was paid.                                 this year, you will carry over the remaining home mortgage 
                                                                   interest to a subsequent year in which you use actual ex-
Keep records to prove your home's depreciable basis.               penses to figure your business portion of the home deduc-
This includes records of when and how you acquired your            tion.
home, your original purchase price, any improvements to            If  you  itemize  your  deductions  on  Schedule  A  (Form 
your home, and any depreciation you are allowed because            1040),  only  include  the  personal  part  of  your  deductible 
you maintained an office in your home. You can keep cop-           mortgage interest on Schedule A (Form 1040), line 8a or 
ies of Forms 8829 or the Worksheet To Figure the Deduc-            8b. The personal portion of your home mortgage interest 
tion  for  Business  Use  of  Your  Home,  found  later  in  this  will generally be the amount of deductible home mortgage 
publication, as records of depreciation.                           interest you figured when treating all home mortgage inter-
For more information on recordkeeping, see Pub. 583,               est as a personal expense and applying the Schedule A 
Starting a Business and Keeping Records.                           (Form 1040) limits on deducting home mortgage interest, 
                                                                   reduced  by  the  business  or  rental  portions  deducted  or 
                                                                   carried  over  as  a  business  or  rental  expense  on  Sched-
                                                                   ule C, E, or F, or any form other than Schedule A. Home 
Where To Deduct                                                    mortgage interest that exceeds the amount you figured af-
                                                                   ter applying the Schedule A (Form 1040) limits on deduct-
Deduct  expenses  for  the  business  use  of  your  home  on      ing  home  mortgage  interest  is  not  deductible  as  a  per-
Form 1040 or Form 1040-SR. Where you deduct these ex-              sonal expense.
penses  on  the  form  depends  on  whether  you  are  a 
self-employed person or a partner.                                 Real estate taxes. You figure the business portion of 
                                                                   your real estate taxes using Form 8829 (if you file Sched-
                                                                   ule C (Form 1040)) or the Worksheet To Figure the Deduc-
Self-Employed Persons                                              tion for Business Use of Your Home in this publication (if 
                                                                   you file Schedule F (Form 1040)). The business portion of 
If  you  use  your  home  in  your  trade  or  business  and  file 
                                                                   your real estate taxes allowed as a deduction this year will 
Schedule  C  (Form  1040),  report  the  entire  deduction  for 
                                                                   be  included  in  the  business  use  of  the  home  deduction 
business  use  of  your  home  on  line  30  of  Schedule  C 
                                                                   you report on Schedule C (Form 1040), line 30, or Sched-
(Form  1040).  Whether  you  need  to  complete  and  attach 
                                                                   ule F (Form 1040), line 32. If you cannot deduct the busi-
Form 8829 to your return depends on how you figure your 
                                                                   ness portion of your real estate taxes in full this year, you 
deduction. See Line 30 in the Instructions for Schedule C 
                                                                   will  carry  over  those  real  estate  taxes  to  a  subsequent 
for more information.
                                                                   year in which you use actual expenses to figure your busi-
If you use your home in your farming business and file             ness portion of the home deduction.
Schedule F (Form 1040), report your entire deduction for           If  you  itemize  your  deductions  on  Schedule  A  (Form 
business use of the home on line 32 of Schedule F (Form            1040),  only  include  the  personal  part  of  your  real  estate 
1040). Enter “Business Use of Home” on the dotted line             taxes on Schedule A (Form 1040), line 5b. The personal 
beside the entry.                                                  portion  of  your  real  estate  taxes  will  generally  be  the 
                                                                   amount of real estate taxes you paid for the home reduced 
Expenses Deductible Without Regard to a                            by the business or rental portions deducted or carried over 
Business Connection                                                as a business or rental expense on Schedule C, E, or F, or 
                                                                   any form other than Schedule A.
Certain expenses related to the use of your home may be            Casualty losses. You will figure the business portion 
deducted whether or not you use your home for business.            of  the  casualty  losses  attributable  to  your  home  using 
These  expenses  may  include  some  or  all  of  your  mort-      Form  8829  (if  you  file  Schedule  C  (Form  1040))  or  the 
gage interest, real estate taxes, and casualty losses attrib-      Worksheet  To  Figure  the  Deduction  for  Business  Use  of 
utable to a federally declared disaster. Where you deduct          Your Home in this publication (if you file Schedule F (Form 
these expenses depends on how you figure your deduc-               1040)).  The  business  portion  of  your  casualty  losses  al-
tion for business use of the home.                                 lowed as a deduction this year will be reported on line 27 
                                                                   in Section B of Form 4684. If you cannot deduct the busi-
Using  actual  expenses  to  figure  the  deduction.   In 
                                                                   ness portion of your casualty losses in full this year, you 
general, you will deduct the business portion of these ex-
                                                                   will carry over those losses to a subsequent year in which 
penses on Schedule C (Form 1040) or Schedule F (Form 
                                                                   you  use  actual  expenses  to  figure  your  business  of  the 
1040) as part of your deduction for business use of your 
                                                                   home deduction.
home. If you itemize your deductions, you will deduct the 
                                                                   Only include the personal portion of your casualty los-
personal portion of these expenses on Schedule A (Form 
                                                                   ses  in  Section  A  of  the  Form  4684  you  attach  to  your 
1040).

18                                                                                                Publication 587 (2023)

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return. If you itemize your deductions on Schedule A Business Expenses Not for Use of Your
(Form 1040), you will include the deductible personal por- Home
tion of the casualty losses attributable to your home fig-
ured on line 18 of Form 4684 on line 15 of Schedule A and No matter how you figure the deduction for business use
the net qualified disaster losses attributable to your home of your home, deduct business expenses that are not for
figured on line 15 of Form 4684 on line 16 of Schedule A. the use of your home itself (dues, salaries, supplies, cer-
If you are increasing your standard deduction by a net tain telephone expenses, depreciation of equipment, etc.)
qualified disaster loss, you will add the net qualified disas- on the appropriate lines of Schedule C (Form 1040) or
ter loss figured on line 15 of Form 4684 to your standard Schedule F (Form 1040). These expenses are not for the
deduction using a Schedule A. use of your home, so they are not subject to the deduction
limit for business use of the home expenses.
Using the simplified method to figure your deduc-
tion. If you use the simplified method to figure your de-
duction for the business use of a home, your mortgage in- Partners

terest, real estate taxes, and casualty losses are treated You may be allowed to deduct unreimbursed ordinary and
as personal expenses, and they are subject to any limits necessary expenses you paid on behalf of the partnership
that apply to deducting personal expenses. No part of any (including qualified expenses for the business use of your
of these expenses can be deducted as a business ex- home) if you were required to pay these expenses under
pense on Schedule C (Form 1040) or Schedule F (Form the partnership agreement and they are trade or business
1040). Generally, you can only deduct these expenses if expenses under section 162.
you itemize your deductions on Schedule A (Form 1040).
If you are using actual expenses to figure your deduc-
Business Expenses for Use of Your Home tion for the business use of your home, use the Worksheet
To Figure the Deduction for Business Use of Your Home,
Other expenses related to the use of your home may be later. If you are using the simplified method to figure your
deducted only to the extent they are related to the busi- deduction for the business use of your home, use the Sim-
ness use of your home. These expenses include insur- plified Method Worksheet, later.
ance, maintenance, utilities, and depreciation of your
home. You cannot deduct the personal portion of any of Deducting unreimbursed partnership expenses. See
these expenses. Where you deduct the business portion the following forms and related instructions for information
of these expenses depends on how you figure your de- about deducting unreimbursed partnership expenses.
duction for business use of the home. • Schedule E (Form 1040), Supplemental Income and
Loss.
Using actual expenses to figure your deduction. If
you file Schedule C (Form 1040), report the other home • Schedule SE (Form 1040), Self-Employment Tax.
expenses that would not be allowable if you did not use • Schedule K-1 (Form 1065), Partner's Share of Income,
your home for business (for example, insurance, mainte- Deductions, Credits, etc.
nance, utilities, and depreciation) on the appropriate lines
of your Form 8829. If you rent rather than own your home, More information. For more information about partners
report the rent you paid on line 19 of Form 8829. If these and partnerships, see Pub. 541, Partnerships.
expenses exceed the deduction limit, carry the excess
over to next year. The carryover will be subject to next
year's deduction limit. Worksheet To Figure the
If you file Schedule F (Form 1040), include your other-
wise nondeductible expenses (insurance, maintenance, Deduction for Business Use of
utilities, depreciation, etc.) with your total busi-
ness-use-of-the-home expenses on Schedule F (Form Your Home
1040), line 32. Enter “Business Use of Home” on the dot-
ted line beside the entry. If these expenses exceed the de- This worksheet is to be used by taxpayers filing Sched-
duction limit, carry the excess over to the next year. The ule F (Form 1040) or by partners with certain unreim-
carryover will be subject to next year's deduction limit. bursed ordinary and necessary expenses if using actual
expenses to figure the deduction. If you are using the sim-
Using the simplified method to figure your deduc- plified method to figure your deduction, use the Simplified
tion. You cannot deduct any of these expenses. The sim- Method Worksheet, later.
plified method is an alternative to calculating and substan-
tiating these expenses. Figure your deduction using the
Simplified Method Worksheet. Instructions for the Worksheet To
Figure the Deduction for Business
Use of Your Home

The Worksheet To Figure the Deduction for Business Use
of Your Home is to be used by taxpayers filing Schedule F

Publication 587 (2023) 19

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Worksheet To Figure the Deduction for Business Use of 
Your Home                                                                                                                             Keep for Your Records
Use this worksheet if you file Schedule F (Form 1040) or you are a partner, and you are using actual expenses to figure 
your deduction for business use of the home. Use a separate worksheet for each qualified business use of your home.
PART 1—Part of Your Home Used for Business:
   1) Area of home used for business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 1)  
   2) Total area of home . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       2)  
   3) Percentage of home used for business (divide line 1 by line 2 and show result as percentage) . . . . .                                                         3)   %
PART 2—Figure Your Allowable Deduction
   4) Gross income from business (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                          4)  
                                                                                                           (a)                        (b)
                                                                                                           Direct                     Indirect 
                                                                                                           Expenses                   Expenses
   5) Casualty losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         5)                              
   6) Deductible mortgage interest . . . . . . . . . . . . . . . . . . . . . . . . .                  6)                              
   7) Real estate taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         7)                              
   8) Total of lines 5 through 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            8)                              
   9) Multiply line 8, column (b), by line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           9)  
10) Add line 8, column (a), and line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             10)  
11) Business expenses not from business use of home (see instructions) . . . . . . . . .                                         11)  
12) Add lines 10 and 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          12)  
13) Deduction limit. Subtract line 12 from line 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                      13)  
14) Excess mortgage interest . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  14)                             
15) Excess real estate taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                15)                             
16) Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       16)                             
17) Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  17)                             
18) Repairs and maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . .                   18)                             
19) Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19)                             
20) Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            20)                             
21) Add lines 14 through 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               21)                             
22) Multiply line 21, column (b), by line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              22)  
23) Carryover of operating expenses from prior year (see instructions) . . . . . . . . . . . .                                   23)  
24) Add line 21, column (a), line 22, and line 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                        24)  
25) Allowable operating expenses. Enter the smaller of line 13 or line 24 . . . . . . . . . . . . . . . . . . . . . . . . .                                          25)  
26) Limit on excess casualty losses and depreciation. Subtract line 25 from line 13 . . . . . . . . . . . . . . . . .                                                26)  
27) Excess casualty losses (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                    27)  
28) Depreciation of your home from line 40 below . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       28)  
29) Carryover of excess casualty losses and depreciation from prior year (see 
   instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29)  
30) Add lines 27 through 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            30)  
31) Allowable excess casualty losses and depreciation. Enter the smaller of line 26 or line 30 . . . . . . . .                                                       31)  
32) Add lines 10, 25, and 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             32)  
33) Casualty losses included on lines 10 and 31 (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                     33)  
34) Allowable expenses for business use of your home. (Subtract line 33 from line 32.) See instructions 
   for where to enter on your return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 34)  
PART 3—Depreciation of Your Home
35) Smaller of adjusted basis or fair market value of home (see instructions) . . . . . . . . . . . . . . . . . . . . . . .                                          35)  
36) Basis of land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    36)  
37) Basis of building (subtract line 36 from line 35) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                        37)  
38) Business basis of building (multiply line 37 by line 3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                            38)  
39) Depreciation percentage (from applicable table or method) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                    39)  %
40) Depreciation allowable (multiply line 38 by line 39) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                           40)  
PART 4—Carryover of Unallowed Expenses to Next Year
41) Operating expenses. Subtract line 25 from line 24. If less than zero, enter -0- . . . . . . . . . . . . . . . . . . .                                            41)  
42) Excess casualty losses and depreciation. Subtract line 31 from line 30. If less than zero, 
   enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42)  

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(Form 1040) or by partners with certain unreimbursed or- personal expenses. If you are itemizing your deductions,
dinary and necessary expenses if using actual expenses when completing line 17 of this worksheet version of Form
to figure the deduction. The following instructions explain 4684, enter 10% of your adjusted gross income excluding
how to complete each part of the worksheet. the gross income and deductions attributable to the busi-
ness use of the home. Do not file this worksheet version of
Partners. See Partners under Where To Deduct, earlier, Form 4684; instead, keep it for your records. You will com-
before completing the worksheet. plete a separate Form 4684 to attach to your return using
If you file Schedule C (Form 1040) and use actual only the personal portion of your casualty losses (and
gains) for Section A.
CAUTION 8829 instead of this worksheet.
! expenses to figure your deduction, use Form Step 2. Include in column (b) of line 5 the loss amounts
from lines 15 and 18 of this worksheet version of Form
4684 that are attributable to the home in which you con-
Part 1—Part of Your Home Used for ducted the business and are the result of a federally de-
Business clared disaster. If you are claiming an increased standard
deduction instead of itemizing your deductions, only use a
Lines 1–3. If you figure the percentage based on area, net qualified disaster loss on line 15 of the worksheet ver-
use lines 1 through 3 to figure the business-use percent- sion of Form 4684 for this Step 2.
age. Enter the percentage on line 3. See the instructions for line 33, later, for the business
You can use any other reasonable method that accu- use of the home casualty losses that you must include in
rately reflects your business-use percentage. If you oper- Section B of the separate Form 4684 you attach to your
ate a daycare facility and you meet the exception to the return.
exclusive use test for part or all of the area you use for
business, you must figure the business-use percentage Casualty losses reported on Schedule A. Use only
for that area as explained under Daycare Facility, earlier. If the personal portion of your casualty losses (and gains)
you use another method to figure your business percent- when completing Section A of the separate Form 4684
age, skip lines 1 and 2 and enter the percentage on line 3. you attach to your return. The separate Form 4684 you at-
tach to your return is used to figure the casualty losses
Part 2—Figure Your Allowable Deduction you can include on line 15 of Schedule A and the net
qualified disaster losses you can include on line 16 of
Line 4. If you file Schedule F (Form 1040), enter your to- Schedule A.
tal gross income that is related to the business use of your Excess casualty losses. See the instructions for
home. This would generally be the amount on line 9 of line 27, later, to deduct the part of your casualty losses for
Schedule F (Form 1040). business use of your home not allowed because of the
limits on deducting casualty losses as a personal ex-
Lines 5–7. Use lines 5, 6, and 7 for business use of the
pense, including any losses that are not the result of a fed-
home expenses that would have been deductible as a
erally declared disaster.
personal expense if you had not used your home for busi-
ness. These expenses include certain casualty losses, Mortgage interest reported on line 6. If you are claim-
mortgage interest, and real estate taxes. ing the standard deduction, do not report an amount on
Taxpayers claiming the standard deduction. If you line 6. If you itemize your deductions, figure the amount to
claim the standard deduction, you will not include any include in column (b) of line 6 as follows.
mortgage interest, or real estate taxes on lines 6 and 7; in- Step 1. Treat all the mortgage interest you paid as a
stead, you will claim the entire business use of the home personal expense and figure the amount that would be de-
portion of those expenses using lines 14 and 15. If you are ductible as an itemized deduction on Schedule A. See
not increasing your standard deduction by a net qualified Pub. 936 for more information about figuring the home
disaster loss, then you will not include any casualty losses mortgage interest deduction and the limits that may apply.
on line 5; instead, you will claim the entire business use of Step 2. Include in column (b) of line 6 the amount of
the home portion of your casualty losses on line 27. If you deductible mortgage interest figured in Step 1 that is at-
are filing Schedule A to increase your standard deduction tributable to the home in which you conducted the busi-
by a net qualified disaster loss, see Casualty losses repor- ness. Because the limits on deducting mortgage interest
ted on line 5, later. as a personal expense are figured using all loans secured
by your home(s), do not claim mortgage interest in column
You may prefer to itemize your deductions on (a) as a direct expense, even if you use a separate struc-
TIP Schedule A to claim amounts on lines 5, 6, and 7, ture in your home in connection with your trade or busi-
even if your total personal deductions are less ness.
than the standard deduction.
Mortgage interest reported on Schedule A. When
Casualty losses reported on line 5. Figure the amount you figure your itemized deduction for mortgage interest
to include in column (b) of line 5 as follows.
Step 1. Complete a worksheet version of Section A of
Form 4684 treating all your casualty losses (and gains) as

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on Schedule A, include the following amounts of deducti- taxes on Schedule A, only include the personal portion of
ble mortgage interest that you figured in Step 1 to the ex- your real estate taxes on line 5b of Schedule A.
tent they are not deducted on another form, such as
Excess real estate taxes. See the instructions for
Schedule E, as a rental expense.
line 15, later, to deduct the part of your real estate taxes
• The amount of deductible mortgage interest you fig- for the home in which you conducted business that is not
ured in Step 1 that is not attributable to the home in allowed on line 7 because of the limitation on deducting
which you conducted the business. state and local taxes as a personal expense.
• The personal portion of deductible mortgage interest
Lines 9 and 10. Multiply your total indirect expenses
you included in column (b) of line 6. For example, if
(line 8, column (b)) by the business percentage from
your business percentage on line 3 is 30%, 70% of the
line 3. Enter the result on line 9. Add this amount to the to-
amount you included in column (b) of line 6 is deducti-
tal direct expenses (line 8, column (a)) and enter the total
ble as an itemized deduction on Schedule A.
on line 10.
Excess mortgage interest. See the instructions for
line 14, later, to deduct the part of your mortgage interest Lines 11–13. Enter any other business expenses that are
from loans used to buy, build, or substantially improve the not attributable to business use of the home on line 11.
home in which you conducted business that is not allowed Farmers should generally enter their total farm expenses
on line 6 because of the limits on deducting home mort- before deducting office-in-the-home expenses. Do not en-
gage interest as a personal expense. ter the deductible part of your self-employment tax. Add
the amounts on lines 10 and 11, and enter the total on
Real estate taxes reported on line 7. If you are claim- line 12. Subtract line 12 from line 4, and enter the result on
ing the standard deduction, do not report an amount on line 13. This is your deduction limit. You use it to deter-
line 7. If you are itemizing deductions, figure the amount to mine whether you can deduct any of your other expenses
include on line 7 as follows. for business use of the home this year. If you cannot, you
Step 1. If the total of your state and local income (or, if will carry them over to the next year in which you use ac-
elected on your Schedule A, general sales) taxes, real es- tual expenses to figure the deduction.
tate taxes, and personal property taxes is not more than If line 13 is zero or less, enter -0-. Deduct your expen-
$10,000 ($5,000 if married filing separately), enter all the ses for deductible home mortgage interest, real estate
real estate taxes attributable to the home in which you taxes, casualty losses, and any business expenses not at-
conducted business in column (b) of line 7. tributable to use of your home on the appropriate lines of
Step 2. If you do not meet the condition of Step 1, use the schedule(s) for Form 1040 or Form 1040-SR, as ex-
the following worksheet to figure the amount to include in plained earlier under Where To Deduct.
column (a) of line 7.
Lines 14–23. On lines 14 through 20, enter your other-
wise nondeductible expenses for the business use of your
Line 7 Worksheet
home. These include utilities, insurance, repairs, and
1. Enter your state and local income taxes (or, if you maintenance. If you rent, report the amount paid on
elect on Schedule A, your state and local general line 17. In column (a), enter the expenses that benefit only
sales taxes) that are personal expenses. . . . . . 1. the business part of your home (direct expenses). In col-
2. Enter all the state and local real estate taxes you umn (b), enter the expenses that benefit the entire home
paid on the home in which you conducted (indirect expenses). Multiply line 21, column (b), by the
business. . . . . . . . . . . . . . . . . . . . . . . . . 2.
business-use percentage (line 3) and enter this amount on
3. Enter any other state and local real estate taxes line 22.
you paid that are a personal expense and not
included on line 2 . . . . . . . . . . . . . . . . . . . . 3. If you deducted actual expenses for the business use of
4. Enter your state and local personal property your home on your 2022 tax return, enter on line 23 the
taxes that are a personal expense . . . . . . . . . . 4. amount from line 41 of your 2022 worksheet. If you used
5. Add lines 1 through 4 . . . . . . . . . . . . . . . . . 5. the simplified method in 2022, enter on line 23 the amount
6. Multiply line 2 by the percentage on line 3 of the from line 6a of your 2022 Simplified Method Worksheet.
Worksheet To Figure the Deduction for Business Line 14—Excess home mortgage interest. If you
Use of Your Home . . . . . . . . . . . . . . . . . . . 6.
are claiming the standard deduction, enter all the home
7. Subtract line 6 from line 5. . . . . . . . . . . . . . . 7. mortgage interest paid for loans used to buy, build, or sub-
8. Subtract line 7 from $10,000 ($5,000 if married stantially improve the home in which you conducted busi-
filing separately). If zero or less, enter -0- . . . . . 8.
ness in column (b) of line 14. Do not include mortgage in-
9. Real estate taxes reported on line 7. Enter the terest on a loan that did not benefit your home (for
smaller of line 6 or line 8 here and in column (a)
of line 7 of the Worksheet To Figure the example, a home equity loan used to pay off credit card
Deduction for Business Use of Your Home . . . . 9. bills, to buy a car, or to pay tuition costs).
10. Excess real estate taxes reported on line 15. If you are itemizing deductions on Schedule A and the
Subtract line 9 from line 6 . . . . . . . . . . . . . . . 10. amount you figured in Step 1 under Mortgage interest re-
ported on line 6, earlier, was less than the full amount of
Real estate taxes reported on Schedule A. When interest you paid because of the limits on deducting home
you figure your itemized deduction for state and local mortgage interest as a personal expense, include the

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excess attributable to the loans used to buy, build, or sub- for business. Do not adjust this amount for changes in ba-
stantially improve the home in which you conducted busi- sis or value after that date. Allocate the basis between the
ness in column (b) of line 14. land and the building on lines 36 and 37. You cannot de-
preciate any part of the land. On line 39, enter the correct
Example. If you paid $15,000 of home mortgage inter- percentage for the current year from the tables in Pub.
est on loans used to buy, build, or substantially improve 946. Multiply this percentage by the business basis to get
the home in which you conducted business but would only the depreciation deduction. Enter this figure on lines 40
be able to deduct $12,000 on Schedule A because of the and 28. Complete and attach Form 4562 to your return if
limits that apply to deducting home mortgage interest as a this is the first year you used your home, or an improve-
personal expense, include $3,000 ($15,000 - $12,000 = ment or addition to your home, in business.
$3,000) in column (b) of line 14.
Line 15—Excess real estate taxes. If you are claim- Part 4—Carryover of Unallowed Expenses to
ing the standard deduction, enter all the real estate taxes Next Year
paid on the home in which you conducted business in col-
umn (b) of line 15. Complete these lines to figure the expenses that must be
If you are itemizing deductions on Schedule A and you carried forward to the next year in which you use actual
used the Line 7 Worksheet to figure the amount to include expenses.
in column (a) of line 7, then include the amount from
line 10 of the Line 7 Worksheet in column (a) of line 15 of
the Worksheet to Figure the Deduction for Business Use Worksheets To Figure the
of Your Home; otherwise do not enter an amount on
line 15. Deduction for Business Use of

Lines 26–31. On lines 26 through 31, figure your limit on Your Home (Simplified Method)
deductions for excess casualty losses and depreciation.
If you deducted actual expenses for business use of The Simplified Method Worksheet and the Daycare Fa-
your home on your 2022 tax return, enter on line 29 the cility Worksheet in this section are to be used by taxpayers
amount from line 42 of your 2022 worksheet. If you used filing Schedule F (Form 1040) or by partners with certain
the simplified method in 2022, enter on line 29 the amount unreimbursed ordinary and necessary expenses if using
from line 6b of your 2022 Simplified Method Worksheet. the simplified method to figure the deduction. If you are fil-
ing Schedule C (Form 1040) to report a business use of
Line 27—Excess casualty loss. Multiply the casu-
your home in your trade or business and you are using the
alty losses attributable to the home in which you conduc-
simplified method to figure the deduction, use the Simpli-
ted business that are in excess of the amount reported on
fied Method Worksheet and the Daycare Facility Work-
line 5 (if any) by the business percentage of those losses
sheet in your Instructions for Schedule C for that business
and enter the result.
use.
Lines 32–34. On line 32, total all allowable busi- The Area Adjustment Worksheet in this section may be
ness-use-of-the-home deductions. used by any taxpayer using the simplified method to figure
On line 33, enter the total of the casualty losses shown the deduction.
on lines 10 and 31. Enter the amount from line 33 on
line 27 of Form 4684, Section B. Attach a statement to
your tax return showing how you calculated the deductible
loss (you can use the worksheet as your attachment) and
enter "See attached statement" above line 27 of Form
4684. See the Instructions for Form 4684 for more infor-
mation on completing that form.
Line 34 is the total (other than casualty losses) allowa-
ble as a deduction for business use of your home. If you
file Schedule F (Form 1040), enter this amount on line 32,
Other expenses, of Schedule F (Form 1040) and enter
“Business Use of Home” on the line beside the entry. Do
not add the specific expenses into other line totals of Part
II of Schedule F (Form 1040).
If you are a partner, see Where To Deduct, earlier, for
information on how to claim the deduction.

Part 3—Depreciation of Your Home

Figure your depreciation deduction on lines 35 through 40.
On line 35, enter the smaller of the adjusted basis or the
fair market value of the property at the time you first used it

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Simplified Method Worksheet

Use this worksheet if you file Schedule F (Form 1040) or you are a partner, and you are using the simplified method to 
figure your deduction for business use of the home. Use a separate worksheet for each qualified business use of your 
home.
1. Enter the amount of the gross income limitation. See the Instructions for the Simplified 
   Method Worksheet   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          1.   

2. Allowable square footage for the qualified business use. Do not enter more than 300 square 
   feet. See the Instructions for the Simplified Method Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                              2.   

3. Simplified method amount
   a. Maximum allowable amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       3a.  $5
   b. For daycare facilities not used exclusively for business, enter the decimal amount from the 
     Daycare Facility Worksheet; otherwise, enter 1.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                      3b.  
   c. Multiply line 3a by line 3b and enter result to 2 decimal places . . . . . . . . . . . . . . . . . . . . . . . . . .                                             3c.  

4. Multiply line 2 by line 3c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          4.   

5. Allowable expenses using the simplified method. Enter the smaller of line 1 or line 4. If 
   zero or less, enter -0-. See Where To Deduct, earlier, for where to enter this amount on 
   your return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.   

6. Carryover of unallowed expenses from a prior year that are not allowed in 2023.
   a. Operating expenses. Enter the amount, if any, from your last Worksheet To Figure the 
     Deduction for Business Use of Your Home, line 41 (line 40 if before 2018). See the 
     Instructions for the Simplified Method Worksheet     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                    6a.  
   b. Excess casualty losses and depreciation. Enter the amount, if any, from your last 
     Worksheet To Figure the Deduction for Business Use of Your Home, line 42 (line 41 if 
     before 2018). See the Instructions for the Simplified Method Worksheet . . . . . . . . . . . . . . . . .                                                          6b.  

Daycare Facility Worksheet (for simplified method)

1. Multiply days used for daycare during the year by hours used per day . . . . . . . . . . . . . . . .                                             1.  

2. Total hours available for use during the year. See the Instructions for the Daycare 
   Facility Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.  

3. Divide line 1 by line 2. Enter the result as a decimal amount here and on line 3b of the 
   Simplified Method Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              3.  

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Area Adjustment Worksheet (for simplified method)

If you used the same area for your qualified business use for the entire year, complete only Part I; otherwise, skip Part I 
and complete Part II using lines 1 through 5 to help you figure the amount to enter for each month. All amounts reported 
on this worksheet must be in square feet.
Part I. Same area was used for the entire year.
1. Area used for this qualified business use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                1.  

2. Shared use. Complete line 2 if someone else also used the home to conduct business that qualifies 
for the deduction; otherwise, enter 300 on line 2d and go to line 3.
a. Area not shared. Enter portion of line 1 that was not shared with another person's qualified 
   business use of the home . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               2a.  
b. Total area shared with another person's qualified business use. Subtract line 2a from line 1 . . . . .                                                       2b.  
c. Reasonable allocation of shared area to this qualified business use . . . . . . . . . . . . . . . . . . . . . . . . .                                        2c.  
d. Add lines 2a and 2c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          2d.  

3. Multiple qualified business uses. Complete line 3 if you used the home for more than one qualified 
business use; otherwise, enter 300 on line 3d and go to line 4.
a. Total area of home used for all your qualified business uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                   3a.  
b. Maximum area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         3b.  300
c. Enter the smaller of line 3a and 3b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  3c.  
d. Reasonable allocation of line 3c to this qualified business use . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                    3d.  

4. Maximum area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   4.   300

5. Enter the smaller of lines 1, 2d, 3d, and 4. Enter the result on line 2 of the Simplified Method 
Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.  

Part II. Area changed during the year or was used for only part of the year.
6. Complete lines 6a through 6n if you used the area for this qualified business use for part of the year or the area used for this 
qualifying business use changed during the year.

   (i) Month           Note. If your qualified business use was less than 15 days in a month,                                                                        (ii) Area
                       enter -0- in column (ii) for that month; otherwise, use lines 1 through 5 
                       above for each month, and enter the amount you get for line 5 in column (ii) 
                       for that month. 
a. January             . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b. February            . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
c. March               . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
d. April               . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
e. May                 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
f. June                . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
g. July                . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
h. August              . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
i. September           . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
j. October             . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
k. November            . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
l. December            . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
m. Add lines 6a through 6l, column (ii) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 6m.  
n. Average monthly allowable square footage. Divide line 6m by 12. Enter the result on line 2 of the 
   Simplified Method Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  6n.  

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Instructions for the Simplified Method Line 2. If you used the same area for the entire year, en-
ter the smaller of the square feet you actually used or 300.
Worksheet If you and your spouse conducted the business as a quali-
If you are a partner or you file Schedule F (Form 1040), fied joint venture, split the square feet between you and
and you elected to use the simplified method, use the your spouse in the same manner you split your other tax
Simplified Method Worksheet. The following instructions attributes. If you shared space with someone else, used
explain how to complete this worksheet. the home for business for only part of the year, or the area
you used changed during the year, see Allowable area un-
Partners. See Partners under Where To Deduct, earlier, der Using the Simplified Method, earlier, before entering
before completing the Simplified Method Worksheet. an amount on this line. Do not enter more than 300 square
feet or, if applicable, the average monthly allowable
Use the Simplified Method Worksheet to figure the square footage on this line. See Part-year use or area
amount of expenses you may deduct for a qualified busi- changes (for simplified method only) under Using the Sim-
ness use of a home if you are electing to use the simplified plified Method, earlier, for more information on how to fig-
method for that home. If you are not electing to use the ure your average monthly allowable square footage.
simplified method, use Form 8829 or the Worksheet To
Figure the Deduction for Business Use of Your Home, ear- Line 3b. If your qualified business use is providing day-
lier, as appropriate. care, you may need to account for the time that you used
the same part of your home for other purposes. If you
Line 1. If all gross income from your trade or business is used the part of your home exclusively and regularly for
from this qualified business use of your home, figure your providing daycare, enter 1.0 on line 3b. If you did not use
gross income limitation as follows. the part of your home exclusively for providing daycare,
complete the Daycare Facility Worksheet to figure what
A. Enter the amount of gross income. If you file Schedule F number to enter on line 3b.
(Form 1040), this amount would generally be the amount
on line 9 of Schedule F. . . . . . . . . . . . . . . . . . . . . . Line 6. Since you are using the simplified method this
B. Enter any gain derived from the business use of your year, you cannot deduct the amounts you entered on lines
home and shown on Form 8949 (and included on 6a and 6b this year. If you figure your deduction for busi-
Schedule D) or Form 4797. . . . . . . . . . . . . . . . . . . .
ness use of the home using actual expenses next year,
C. Add lines A and B . . . . . . . . . . . . . . . . . . . . . . . . .
you will be able to include these expenses when you fig-
D. Business expenses not from business use of the home. . ure your deduction.
E. Enter the total amount of any losses (as a positive
number) shown on Form 8949 (and included on Line 6a. If you did not complete a 2022 Worksheet To
Schedule D) or Form 4797 that are allocable to the Figure the Deduction for Business Use of Your Home,
business, but not allocable to the business use of the then your carryover of prior-year operating expenses is the
home. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
amount of operating expenses shown in Part 4 of the last
F. Add lines D and E. . . . . . . . . . . . . . . . . . . . . . . . . Worksheet To Figure the Deduction for Business Use of
G. Gross income limitation. Subtract line F from line C. Enter Your Home, if any, that you completed using actual expen-
the result here and on line 1 . . . . . . . . . . . . . . . . . . .
ses in order to claim a deduction for business use of the
home as a partner or Schedule F filer.
If some of the income is from a place of business other
than your home, you must first determine the part of your Line 6b. If you did not complete a 2022 Worksheet To
gross income from the business use of your home. In Figure the Deduction for Business Use of Your Home,
making this determination, consider the amount of time then your carryover of prior-year excess casualty losses
you spent at each location as well as other facts. After de- and depreciation is the amount of excess casualty losses
termining the part of your gross income from the business and depreciation shown in Part 4 of the last Worksheet To
use of your home, subtract from that amount the total ex- Figure the Deduction for Business Use of Your Home, if
penses and any losses that are allocable to the business any, that you completed using actual expenses to claim a
in which you use your home but that are not allocable to deduction for business use of the home as a partner or
the business use of the home. Schedule F filer.
Only include on line A the gross income from the busi-
ness that is related to the business use of your home. Instructions for the Daycare Facility
Only include on line D and line E the deductible business
expenses and losses that are related to the business ac- Worksheet

tivity in the home, but not related to the business use of Use the Daycare Facility Worksheet to figure the percent-
the home itself. age to use on line 3b of the Simplified Method Worksheet.
Note. If you had more than one home in which you If you do not use the area of your home exclusively for
conducted this business during the year, include only the daycare, you must reduce the amount on line 3a before
income earned and the deductions attributable to that in- figuring your deduction using the simplified method.
come during the period you owned the home for which
you elected to use the simplified method.

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If you used at least 300 square feet for daycare January only; then, enter the result in line 6a, column (ii).
TIP regularly and exclusively during the year, then you If, in any month, you did not have 15 or more days of this
do not need to complete this worksheet. This qualified business use, enter -0- for that month. For exam-
worksheet is only needed if you did not use the allowable ple, if you did not begin using your home for this qualified
area exclusively for daycare. business use until January 20, enter -0- in line 6a, column
(ii).
Line 1. Enter the total number of hours the facility was
used for daycare during the year.
How To Get Tax Help
Example. Your home is used Monday through Friday
for 12 hours per day for 250 days during the year. It is also If you have questions about a tax issue; need help prepar-
used on 50 Saturdays for 8 hours a day. Enter 3,400 hours ing your tax return; or want to download free publications,
on line 4 (3,000 hours for weekdays plus 400 hours for forms, or instructions, go to IRS.gov to find resources that
Saturdays). can help you right away.

Line 2. If you used your home for daycare during the en- Preparing and filing your tax return. After receiving all
tire year, multiply 365 days (366 for a leap year) by 24 your wage and earnings statements (Forms W-2, W-2G,
hours, and enter the result. 1099-R, 1099-MISC, 1099-NEC, etc.); unemployment
If you started or stopped using your home for daycare compensation statements (by mail or in a digital format) or
during the year, you must prorate the number of hours other government payment statements (Form 1099-G);
based on the number of days the home was available for and interest, dividend, and retirement statements from
daycare. Multiply 24 hours by the number of days availa- banks and investment firms (Forms 1099), you have sev-
ble and enter that result. eral options to choose from to prepare and file your tax re-
turn. You can prepare the tax return yourself, see if you
Instructions for the Area Adjustment qualify for free tax preparation, or hire a tax professional to
Worksheet prepare your return.

Free options for tax preparation. Your options for pre-
Use the Area Adjustment Worksheet to figure the area that
paring and filing your return online or in your local com-
you may use to figure your deduction.
munity, if you qualify, include the following.
Line 2. If you and another person both used the home to • Free File. This program lets you prepare and file your
conduct business that qualifies for the deduction, the federal individual income tax return for free using soft-
same area cannot be used by both persons to figure the ware or Free File Fillable Forms. However, state tax
deduction. preparation may not be available through Free File. Go
to IRS.gov/FreeFile to see if you qualify for free online
Line 2c. With the other people using the home for quali- federal tax preparation, e-filing, and direct deposit or
fied business use, determine a reasonable allocation of payment options.
shared space to your qualified business use. Do not in-
clude area that is claimed by another person. • VITA. The Volunteer Income Tax Assistance (VITA)
program offers free tax help to people with
Line 3. If you used your home for more than one qualified low-to-moderate incomes, persons with disabilities,
business use, the total area that you can use to figure the and limited-English-speaking taxpayers who need
deduction is still only 300 square feet, not 300 square feet help preparing their own tax returns. Go to IRS.gov/
per business use. You may allocate the square footage VITA, download the free IRS2Go app, or call
among your qualified business uses in any reasonable 800-906-9887 for information on free tax return prepa-
manner, but you may not allocate more square feet to a ration.
qualified business use than was actually used.
• TCE. The Tax Counseling for the Elderly (TCE) pro-
Line 3d. Allocate part of line 3c to this qualified business gram offers free tax help for all taxpayers, particularly
use. Do not allocate more square feet to this qualified those who are 60 years of age and older. TCE volun-
business use than was actually used during the year. Do teers specialize in answering questions about pen-
not allocate any amount on line 3c to this qualified busi- sions and retirement-related issues unique to seniors.
ness use that you allocated to another qualified business Go to IRS.gov/TCE or download the free IRS2Go app
use. for information on free tax return preparation.
• MilTax. Members of the U.S. Armed Forces and quali-
Line 6. If you only used the area for this qualified busi- fied veterans may use MilTax, a free tax service of-
ness use for part of the year or the area used for this quali- fered by the Department of Defense through Military
fying business use changed during the year, then you OneSource. For more information, go to
need to figure the average monthly allowable square foot- MilitaryOneSource MilitaryOneSource.mil/MilTax ( ).
age. To do this, use lines 1 through 5 of this worksheet for
each month. For example, for January, complete lines 1
through 5 using the area and allocation information for

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Also, the IRS offers Free Fillable Forms, which can matters. For more information on how to choose a tax pre-
be completed online and then e-filed regardless of in- parer, go to Tips for Choosing a Tax Preparer on IRS.gov.
come.
Using online tools to help prepare your return. Go to Employers can register to use Business Services On-
IRS.gov/Tools for the following. line. The Social Security Administration (SSA) offers on-
line service at SSA.gov/employer for fast, free, and secure
• The Earned Income Tax Credit Assistant IRS.gov/ (
W-2 filing options to CPAs, accountants, enrolled agents,
EITCAssistant) determines if you’re eligible for the
and individuals who process Form W-2, Wage and Tax
earned income credit (EIC).
Statement, and Form W-2c, Corrected Wage and Tax
• The Online EIN Application IRS.gov/EIN ( ) helps you Statement.
get an employer identification number (EIN) at no
cost. IRS social media. Go to IRS.gov/SocialMedia to see the
various social media tools the IRS uses to share the latest
• The Tax Withholding Estimator IRS.gov/W4App ( )
information on tax changes, scam alerts, initiatives, prod-
makes it easier for you to estimate the federal income
ucts, and services. At the IRS, privacy and security are our
tax you want your employer to withhold from your pay-
highest priority. We use these tools to share public infor-
check. This is tax withholding. See how your withhold-
mation with you. Don’t post your social security number
ing affects your refund, take-home pay, or tax due.
(SSN) or other confidential information on social media
• The First-Time Homebuyer Credit Account Look-up sites. Always protect your identity when using any social
(IRS.gov/HomeBuyer) tool provides information on networking site.
your repayments and account balance. The following IRS YouTube channels provide short, in-
formative videos on various tax-related topics in English,
• The Sales Tax Deduction Calculator IRS.gov/ (
Spanish, and ASL.
SalesTax) figures the amount you can claim if you
itemize deductions on Schedule A (Form 1040). • Youtube.com/irsvideos.
Getting answers to your tax questions. On • Youtube.com/irsvideosmultilingua.
IRS.gov, you can get up-to-date information on
• Youtube.com/irsvideosASL.
current events and changes in tax law.
• IRS.gov/Help: A variety of tools to help you get an- Watching IRS videos. The IRS Video portal
swers to some of the most common tax questions. (IRSVideos.gov) contains video and audio presentations
for individuals, small businesses, and tax professionals.
• IRS.gov/ITA: The Interactive Tax Assistant, a tool that
will ask you questions and, based on your input, pro- Online tax information in other languages. You can
vide answers on a number of tax topics. find information on IRS.gov/MyLanguage if English isn’t
• IRS.gov/Forms: Find forms, instructions, and publica- your native language.
tions. You will find details on the most recent tax
Free Over-the-Phone Interpreter (OPI) Service. The
changes and interactive links to help you find answers
IRS is committed to serving taxpayers with limited-English
to your questions.
proficiency (LEP) by offering OPI services. The OPI Serv-
• You may also be able to access tax information in your ice is a federally funded program and is available at Tax-
e-filing software. payer Assistance Centers (TACs), most IRS offices, and
every VITA/TCE tax return site. The OPI Service is acces-
sible in more than 350 languages.
Need someone to prepare your tax return? There are
various types of tax return preparers, including enrolled Accessibility Helpline available for taxpayers with
agents, certified public accountants (CPAs), accountants, disabilities. Taxpayers who need information about ac-
and many others who don’t have professional credentials. cessibility services can call 833-690-0598. The Accessi-
If you choose to have someone prepare your tax return, bility Helpline can answer questions related to current and
choose that preparer wisely. A paid tax preparer is: future accessibility products and services available in al-
• Primarily responsible for the overall substantive accu- ternative media formats (for example, braille, large print,
racy of your return, audio, etc.). The Accessibility Helpline does not have ac-
cess to your IRS account. For help with tax law, refunds, or
• Required to sign the return, and account-related issues, go to IRS.gov/LetUsHelp.
• Required to include their preparer tax identification
number (PTIN).
Although the tax preparer always signs the return,
! you're ultimately responsible for providing all the
CAUTION information required for the preparer to accurately
prepare your return and for the accuracy of every item re-
ported on the return. Anyone paid to prepare tax returns
for others should have a thorough understanding of tax

28 Publication 587 (2023)

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Note. Form 9000, Alternative Media Preference, or which securely and electronically transfers your refund di-
Form 9000(SP) allows you to elect to receive certain types rectly into your financial account. Direct deposit also
of written correspondence in the following formats. avoids the possibility that your check could be lost, stolen,
• Standard Print. destroyed, or returned undeliverable to the IRS. Eight in
10 taxpayers use direct deposit to receive their refunds. If
• Large Print. you don’t have a bank account, go to IRS.gov/
• Braille. DirectDeposit for more information on where to find a bank
or credit union that can open an account online.
• Audio (MP3).
• Plain Text File (TXT). Reporting and resolving your tax-related identity
theft issues.
• Braille Ready File (BRF).
• Tax-related identity theft happens when someone
Disasters. Go to IRS.gov/DisasterRelief to review the steals your personal information to commit tax fraud.
available disaster tax relief. Your taxes can be affected if your SSN is used to file a
fraudulent return or to claim a refund or credit.
Getting tax forms and publications. Go to IRS.gov/
Forms to view, download, or print all the forms, instruc- • The IRS doesn’t initiate contact with taxpayers by
tions, and publications you may need. Or, you can go to email, text messages (including shortened links), tele-
IRS.gov/OrderForms to place an order. phone calls, or social media channels to request or
verify personal or financial information. This includes
Getting tax publications and instructions in eBook requests for personal identification numbers (PINs),
format. Download and view most tax publications and in- passwords, or similar information for credit cards,
structions (including the Instructions for Form 1040) on banks, or other financial accounts.
mobile devices as eBooks at IRS.gov/eBooks. Go to IRS.gov/IdentityTheft, the IRS Identity Theft
•
IRS eBooks have been tested using Apple's iBooks for Central webpage, for information on identity theft and
iPad. Our eBooks haven’t been tested on other dedicated data security protection for taxpayers, tax professio-
eBook readers, and eBook functionality may not operate nals, and businesses. If your SSN has been lost or
as intended. stolen or you suspect you’re a victim of tax-related
Access your online account (individual taxpayers identity theft, you can learn what steps you should
only). Go to IRS.gov/Account to securely access infor- take.
mation about your federal tax account. • Get an Identity Protection PIN (IP PIN). IP PINs are
• View the amount you owe and a breakdown by tax six-digit numbers assigned to taxpayers to help pre-
year. vent the misuse of their SSNs on fraudulent federal in-
come tax returns. When you have an IP PIN, it pre-
• See payment plan details or apply for a new payment vents someone else from filing a tax return with your
plan. SSN. To learn more, go to IRS.gov/IPPIN.
• Make a payment or view 5 years of payment history
and any pending or scheduled payments. Ways to check on the status of your refund.
• Access your tax records, including key data from your • Go to IRS.gov/Refunds.
most recent tax return, and transcripts. • Download the official IRS2Go app to your mobile de-
• View digital copies of select notices from the IRS. vice to check your refund status.
• Approve or reject authorization requests from tax pro- • Call the automated refund hotline at 800-829-1954.
fessionals. The IRS can’t issue refunds before mid-February
• View your address on file or manage your communica- ! for returns that claimed the EIC or the additional
tion preferences. CAUTION child tax credit (ACTC). This applies to the entire
refund, not just the portion associated with these credits.
Get a transcript of your return. With an online account,
you can access a variety of information to help you during Making a tax payment. Payments of U.S. tax must be
the filing season. You can get a transcript, review your remitted to the IRS in U.S. dollars. Digital assets are not
most recently filed tax return, and get your adjusted gross accepted. Go to IRS.gov/Payments for information on how
income. Create or access your online account at IRS.gov/ to make a payment using any of the following options.
Account.
• IRS Direct Pay: Pay your individual tax bill or estimated
Tax Pro Account. This tool lets your tax professional tax payment directly from your checking or savings ac-
submit an authorization request to access your individual count at no cost to you.
taxpayer IRS online account. For more information, go to • Debit Card, Credit Card, or Digital Wallet: Choose an
IRS.gov/TaxProAccount. approved payment processor to pay online or by
phone.
Using direct deposit. The safest and easiest way to re-
ceive a tax refund is to e-file and choose direct deposit,

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• Electronic Funds Withdrawal: Schedule a payment taxpayers is part of a multi-year timeline that began pro-
when filing your federal taxes using tax return prepara- viding translations in 2023. You will continue to receive
tion software or through a tax professional. communications, including notices and letters, in English
until they are translated to your preferred language.
• Electronic Federal Tax Payment System: Best option
for businesses. Enrollment is required. Contacting your local TAC. Keep in mind, many ques-
• Check or Money Order: Mail your payment to the ad- tions can be answered on IRS.gov without visiting a TAC.
dress listed on the notice or instructions. Go to IRS.gov/LetUsHelp for the topics people ask about
most. If you still need help, TACs provide tax help when a
• Cash: You may be able to pay your taxes with cash at
tax issue can’t be handled online or by phone. All TACs
a participating retail store.
now provide service by appointment, so you’ll know in ad-
• Same-Day Wire: You may be able to do same-day vance that you can get the service you need without long
wire from your financial institution. Contact your finan- wait times. Before you visit, go to IRS.gov/TACLocator to
cial institution for availability, cost, and time frames. find the nearest TAC and to check hours, available serv-
ices, and appointment options. Or, on the IRS2Go app,
Note. The IRS uses the latest encryption technology to under the Stay Connected tab, choose the Contact Us op-
ensure that the electronic payments you make online, by tion and click on “Local Offices.”
phone, or from a mobile device using the IRS2Go app are
safe and secure. Paying electronically is quick, easy, and
faster than mailing in a check or money order. The Taxpayer Advocate Service (TAS)
Is Here To Help You
What if I can’t pay now? Go to IRS.gov/Payments for
more information about your options. What Is TAS?

• Apply for an online payment agreement IRS.gov/ ( TAS is an independent organization within the IRS that
OPA) to meet your tax obligation in monthly install- helps taxpayers and protects taxpayer rights. TAS strives
ments if you can’t pay your taxes in full today. Once to ensure that every taxpayer is treated fairly and that you
you complete the online process, you will receive im- know and understand your rights under the Taxpayer Bill
mediate notification of whether your agreement has of Rights.
been approved.
• Use the Offer in Compromise Pre-Qualifier to see if How Can You Learn About Your Taxpayer
you can settle your tax debt for less than the full Rights?
amount you owe. For more information on the Offer in
Compromise program, go to IRS.gov/OIC. The Taxpayer Bill of Rights describes 10 basic rights that
all taxpayers have when dealing with the IRS. Go to
Filing an amended return. Go to IRS.gov/Form1040X
TaxpayerAdvocate.IRS.gov to help you understand what
for information and updates.
these rights mean to you and how they apply. These are
Checking the status of your amended return. Go to your rights. Know them. Use them.
IRS.gov/WMAR to track the status of Form 1040-X amen-
ded returns. What Can TAS Do for You?
It can take up to 3 weeks from the date you filed
TAS can help you resolve problems that you can’t resolve
! your amended return for it to show up in our sys- with the IRS. And their service is free. If you qualify for
CAUTION tem, and processing it can take up to 16 weeks.
their assistance, you will be assigned to one advocate
who will work with you throughout the process and will do
Understanding an IRS notice or letter you’ve re- everything possible to resolve your issue. TAS can help
ceived. Go to IRS.gov/Notices to find additional informa- you if:
tion about responding to an IRS notice or letter.
• Your problem is causing financial difficulty for you,
Responding to an IRS notice or letter. You can now your family, or your business;
upload responses to all notices and letters using the • You face (or your business is facing) an immediate
Document Upload Tool. For notices that require additional threat of adverse action; or
action, taxpayers will be redirected appropriately on
IRS.gov to take further action. To learn more about the • You’ve tried repeatedly to contact the IRS but no one
tool, go to IRS.gov/Upload. has responded, or the IRS hasn’t responded by the
date promised.
Note. You can use Schedule LEP (Form 1040), Re-
quest for Change in Language Preference, to state a pref- How Can You Reach TAS?
erence to receive notices, letters, or other written commu-
nications from the IRS in an alternative language. You may TAS has offices in every state, the District of Columbia,
not immediately receive written communications in the re- and Puerto Rico. To find your advocate’s number:
quested language. The IRS’s commitment to LEP
• Go to TaxpayerAdvocate.IRS.gov/Contact-Us;

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• Download Pub. 1546, The Taxpayer Advocate Service and who need to resolve tax problems with the IRS. LITCs
Is Your Voice at the IRS, available at IRS.gov/pub/irs- can represent taxpayers in audits, appeals, and tax collec-
pdf/p1546.pdf; tion disputes before the IRS and in court. In addition,
• Call the IRS toll free at 800-TAX-FORM LITCs can provide information about taxpayer rights and
(800-829-3676) to order a copy of Pub. 1546; responsibilities in different languages for individuals who
speak English as a second language. Services are offered
• Check your local directory; or for free or a small fee. For more information or to find an
• Call TAS toll free at 877-777-4778. LITC near you, go to the LITC page at
TaxpayerAdvocate.IRS.gov/LITC or see IRS Pub. 4134,
How Else Does TAS Help Taxpayers? Low Income Taxpayer Clinic List, at IRS.gov/pub/irs-pdf/
4134.pdf.
TAS works to resolve large-scale problems that affect
many taxpayers. If you know of one of these broad issues,
report it to TAS at IRS.gov/SAMS. Be sure to not include
any personal taxpayer information.

Low Income Taxpayer Clinics (LITCs)

LITCs are independent from the IRS and TAS. LITCs rep-
resent individuals whose income is below a certain level

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                                                                                                                                                                                                                    Totals             Number served:        _____      Breakfasts: _____          Lunches: _____ Dinners: ______  Snacks: ______       Number served:        _____      Breakfasts: _____ Lunches: _____ Dinners: _____  Snacks: _____       Number served:       _____       Breakfasts: _____ Lunches: _____ Dinners: _____  Snacks: _____       Number served:       _____            Breakfasts: _____ Lunches: _____ Dinners: _____                Snacks: _____

                                                                                                                                                                                                                                                                                    Bkfst          Snack    Lunch Snack           Dinner          Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                                   Bkfst Snack    Lunch Snack                        Dinner        Snack
                                                                                                                                                                                              Keep For Your Records Sunday             Hours of             attendance: _____                                                                           Hours of             attendance: _____                                                                Hours of             attendance: _____                                                                Hours of             attendance:      _____

                                                                                                                                                                                                                                                                                    Bkfst          Snack    Lunch Snack           Dinner          Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                                   Bkfst Snack    Lunch Snack                        Dinner        Snack
                                                                                                                                                                                                                    Saturday           Hours of             attendance: _____                                                                           Hours of             attendance: _____                                                                Hours of             attendance: _____                                                                Hours of             attendance:      _____

                                                                                                                                                                                                                                                                                    Bkfst          Snack    Lunch Snack           Dinner          Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                                   Bkfst Snack    Lunch Snack                        Dinner        Snack
                                                                                                                                                                                                                    Friday             Hours of             attendance: _____                                                                           Hours of             attendance: _____                                                                Hours of             attendance: _____                                                                Hours of             attendance:      _____

                                                                                                                                                                                                                                                                                    Bkfst          Snack    Lunch Snack           Dinner          Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                                   Bkfst Snack    Lunch Snack                        Dinner        Snack
                                                                                                                                                                                                                    Thursday           Hours of             attendance: _____                                                                           Hours of             attendance: _____                                                                Hours of             attendance: _____                                                                Hours of             attendance:      _____

                                          Family Daycare Provider Meal and Snack Log
                                                                                                                                                                                                                                                                                    Bkfst          Snack    Lunch Snack           Dinner          Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                                   Bkfst Snack    Lunch Snack                        Dinner        Snack
                                                                                                                                                                                                                    Wednesday          Hours of             attendance: _____                                                                           Hours of             attendance: _____                                                                Hours of             attendance: _____                                                                Hours of             attendance:      _____

                                          Exhibit A.

                                                                                                                                                                                                                                                                                    Bkfst          Snack    Lunch Snack           Dinner          Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                                   Bkfst Snack    Lunch Snack                        Dinner        Snack
                                                                                                                                                                                                                    Tuesday            Hours of             attendance: _____                                                                           Hours of             attendance: _____                                                                Hours of             attendance: _____                                                                Hours of             attendance:      _____

                                                                                                                                                                                                                                                                                    Bkfst          Snack    Lunch Snack           Dinner          Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                              Bkfst Snack    Lunch Snack          Dinner         Snack                                                   Bkfst Snack    Lunch Snack                        Dinner        Snack
                                                                                                                                                                                                                    Monday             Hours of             attendance: _____                                                                           Hours of             attendance: _____                                                                Hours of             attendance: _____                                                                Hours of             attendance:      _____

                                                                                    Name of Provider _______________________________ Week of _____________________________ Year______________                       Child's Name

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                   To help us develop a more useful index, please let us know if you have ideas for index entries.
Index              See “Comments and Suggestions” in the “Introduction” for the ways you can reach us.
 
                                         Adjusted basis   8
A                                        Business furniture and                I
Adjusted basis defined   8               equipment       16 17,                Improvements (See Permanent 
Administrative or management             Fair market value 8                    improvements)
 activities 4                            Figuring depreciation for the current Insurance 7
Assistance (See Tax help)                year    8                             Inventory, storage of 3
Attorneys 5                              Home   7
                                         Nonresidential real property 8        L
B                                        Percentage table for 39-year          Listed property:
Business expenses not for use of         nonresidential real property   8       Defined 16
 home    19                              Percentage table for 5- and 7-year     Reporting and recordkeeping 
Business furniture and                   property   17                          requirements   16
 equipment   16                          Permanent improvements   8 9,          Years following the year placed in 
Business percentage    9               Depreciation of home     7               service   16
Business use of the home                 Basis adjustment  15
 requirements (See Qualifying for a      MACRS (Table 2)    8                  M
 deduction)                              Property bought for business          MACRS percentage table:
                                         use    15                              39-year nonresidential real 
C                                        Sale or exchange of your home  15      property    8
Carryover of unallowed expenses      9 Doctors  5                               5- and 7-year property 17
Child and Adult Care Food Program                                              Meals 13
 reimbursements     13                 E                                       Meeting with patients, clients, or 
                                       Exclusive use  3                         customers on premises                    5
D                                      Expenses:                               More than one place of 
Daycare facilities 12                    Direct 6                               business  10
 Eligible children for standard meal     Indirect 6                            More than one trade or business                5
  and snack rates    14                  Insurance  7                          More-than-50%-use test  16
 Exceptions for regular use              Related to tax-exempt income   6
  requirement   12                       Rent 7                                P
 Family daycare   14                     Repairs  7                            Partners 19
 Meals   13 14,                          Security system   7                   Partnership expenses, 
 Regular basis  12                       Telephone  7                           unreimbursed   19
 Standard meal and snack rates   13,     Unrelated  6                          Permanent improvements                    8 9, 
  14                                     Utilities and services 7              Personal property converted to 
Deduction limit 9                        Where to deduct   18                   business use   17
Deduction requirements:                                                        Place of business, more than 
 Exceptions to exclusive use 3         F                                        one  10
 Exclusive use  3                                                              Principal place of business               3
                                       Fair market value   8
 More than one trade or business 5                                             Product samples 3
                                       Family daycare providers   14
 Place to meet patients, clients, or                                           Property bought for business use:
                                         Meal and snack log (Exhibit A) 32
  customers     5                                                               Depreciation 17
                                         Standard meal and snack rates   14
 Principal place of business 3                                                  Section 179 deduction  16
                                       Figuring the deduction:
 Regular use  3                                                                Property converted to business 
                                         Business percentage    9
 Separate structure  6                                                          use, Personal  17
                                         Deduction limit  9
 Storage of inventory or product                                               Publications 2
  samples    3                         Form 2 18, 
 Trade or business use  3                1040, Schedule F:                     Q
Deductions                               Worksheet       20
                                                                               Qualifying for a deduction                2
 Figuring 6 21,                          4562 16
 Limit 9                                 8829 6 9 13,  ,                       R
 Part-year use  6                                                              Recordkeeping   17
                                       H
 Qualifying for 2                                                              Regular use 3
 Unreimbursed partnership              Home:
                                                                               Reminders  1
  expenses    19                         Business percentage    9
                                                                               Rent 7
 Using Actual Expenses   6               Depreciation    7
                                                                               Repairs 7
Dentists 5                               Sale of  14
                                                                               Reporting and recordkeeping 
Depreciation 16                        Home expenses, Can you deduct            requirements   16
 5-year property  17                     business use of, Figure A    4
                                                                                Meal and snack log (Exhibit A)                32
 7-year property  17

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Reporting requirements:              Electing the simplified method 10   Standard meal and snack rates 
  Business furniture and             More than one home    11            (Table 3)  14
   equipment   16                    More than one qualified business    Types of expenses (Table 1)                     6
                                     use     10                         Tax help  27
S                                    Shared use 10                      Telephone  7
Sale or exchange of your home    14  Expenses deductible without regard Trade or business use 3
  Basis adjustment  15               to business use    10              Types of expenses 6
  Depreciation 15                    No deduction of carryover of 
  Ownership and use tests 14         unallowed expenses    10           U
Schedule F (See Worksheet to figure  Part-year use or area changes  11  Utilities 7
  the deduction)                     Simplified amount  11
Section 179 16                       Space used regularly for           W
  Business furniture and             daycare 12
                                                                        Where to deduct expenses                         18
   equipment   16                    Using the simplified method    10
                                                                         Self-employed 18
  Listed property 16                Standard meal and snack rates     14
                                                                        Worksheets:
  Personal property converted to    Storage of inventory or product 
   business use   17                 samples 3                           Area Adjustment Worksheet (for 
                                                                         simplified method)   25
  Property bought for business                                           Worksheet to figure the deduction 
   use 16                           T
                                                                         for business use of your home                     20
Security system   7                 Tables and figures:                  Worksheets to figure the deduction 
Self-employed persons:               MACRS:                              for business use of your home 
  Deduction of expenses  18          Percentage table for 39-year        (simplified method)  23
Separate structure  6                nonresidential real property        Daycare facility worksheet (for 
Simplified Method:                   (Table 2)  8                        simplified method)     24
  Actual expenses and depreciation   Percentage table for 5- and         Simplified method worksheet                       24
   of your home   10                 7-year property (Table 4)      17
  Allowable area  11                 Qualifying for deduction (Figure 
  Business expenses not related to   A) 4
   use of the home   12

34                                                                                  Publication 587 (2023)

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