Can I write off my studio apartment rent as a business expense for my new LLC?

You need to be careful with home office deductions, especially in your situation. The IRS has specific requirements for claiming part of your living space as a business expense. The space must be used "regularly and exclusively" for business - meaning that corner desk area can't double as where you eat dinner or play video games. For a studio apartment, this gets tricky since it's essentially one room. You'd need to clearly designate a portion of the space that's ONLY for business use. Think about whether you can truly have a space that's exclusively for business in a small studio. Also, since you mentioned you're not making money yet, be aware that the IRS might flag this as a hobby rather than a business if you don't show profit in 3 out of 5 years. If classified as a hobby, you wouldn't be eligible for business expense deductions.

I used to waste so much time trying to figure out all these deduction rules until I found https://taxr.ai which analyzes all my business receipts and tells me exactly what's deductible. For my home office situation (I'm a freelancer in a 1-bedroom), it helped clarify exactly what percentage I could legitimately claim for my business and saved me from making some mistakes that could have raised red flags. When I uploaded my lease and floor plan, it gave me specific guidelines based on my situation about what qualified as a legitimate home office deduction. The tool basically told me I needed to establish clear boundaries for my work space and maintain those throughout the year.

Just wanted to update everyone - I checked out https://taxr.ai like mentioned above and it was super helpful for my similar situation! I'm also a student with a side business and wasn't sure what I could deduct. It analyzed my apartment layout and showed me exactly what percentage I could legally claim as a home office. The guidance about proving "regular and exclusive use" was really clear - apparently I needed to be way more strict about keeping my work area separate than I realized. It also helped me understand how to document everything properly in case of an audit. Definitely worth checking out if you're confused about home office deductions like I was!

If you're serious about your business and need specific tax questions answered, you should really talk to the IRS directly. I know that sounds impossible - I spent HOURS on hold trying to get someone to answer my home office deduction questions last year. Then I found https://claimyr.com which got me through to an actual IRS agent in under 15 minutes! You can see how it works here: https://youtu.be/_kiP6q8DX5c They basically wait on hold for you and call when an agent is ready. I was super skeptical at first, but it actually worked amazingly well. The agent I spoke with gave me the exact guidelines for my situation and I felt much more confident about my deductions after talking to them directly.

OK I have to eat my words. After seeing the above comment I actually tried https://claimyr.com because I've been trying to get clarity on my own home office situation for weeks. Got connected to an IRS agent in about 45 minutes (which is WAY faster than I expected). The agent walked me through the exact requirements for claiming a home office deduction with my specific situation. For what it's worth, they told me that for a studio apartment, you CAN claim a portion as long as it's clearly designated for business use only - even without physical walls. They suggested taking photos, keeping a business activity log, and making sure any claimed area never gets used for personal activities.

Just to add another perspective - I tried doing the home office deduction in my studio apartment last year and it was more trouble than it was worth. Ended up getting flagged for review because I claimed about 30% of my tiny apartment as "exclusive business use" and the IRS questioned it. Had to provide tons of documentation, photos, and detailed explanations. Even though I technically was using that space exclusively for business, proving it was a nightmare. After all that hassle, the actual tax savings was pretty minimal - only about $400 for the whole year. For me personally, it wasn't worth the stress.

Has anyone used TurboTax for handling home office deductions? I'm in a similar situation (small apartment, running a business) and wondering if the software makes this process any easier or if I should just hire a professional.

I'm dealing with a very similar situation - junior in college with an LLC that I'm building while in school. After reading through all these responses, I think the key takeaways are: 1) You absolutely need exclusive business use of the space (no eating/sleeping/studying in your "office area"), 2) Document everything with photos and business activity logs, 3) Keep the percentage reasonable (under 20% seems safer), and 4) Make sure you can show legitimate business intent even without profits yet. One thing I'm still curious about - if you're claiming part of your studio as business space, do you also need to adjust your security deposit and utilities proportionally as business expenses? Or is it just the rent that gets the percentage deduction? Also, since you mentioned you're heading into sophomore year, have you considered whether claiming this deduction might affect your financial aid eligibility at all? I know business income can impact FAFSA calculations, so wondering if business expenses do too.