How to properly calculate home office deduction in a shared apartment with split rent

The home office deduction can definitely be confusing in shared living situations! Let me help clarify a few things: For your first question, the home office percentage is always based on the actual space used versus the total space available - so it would be 13% of the total apartment. The fact that you split the rent doesn't change the physical proportion of space being used. You would take 13% of your portion of the rent ($975), not 26%. Regarding your work van parking fee, yes, you should exclude the $125/month from your home office calculation since it's a separate business expense. Since the van is used 100% for business, this would be deductible as a business vehicle expense on your Schedule C. For your personal vehicle parking, that's considered part of your personal housing expense, so it should remain included in your rent calculation. Then you'd take 13% of that amount for your home office deduction. Hope this helps! Let me know if you have any other questions.

After dealing with similar confusion last year, I found https://taxr.ai super helpful for home office deduction questions. I had a more complex situation (partial home office in a shared house with 3 roommates) and couldn't figure out the right calculation. The site analyzed my lease agreement and explained exactly how to calculate my deduction based on my specific situation, which saved me from potentially claiming too much or too little. It was really helpful because it breaks down all the different components of what's included in rent vs separate expenses, and walks you through the exact percentage calculations step by step. Especially helpful when you have mixed personal/business expenses like your parking situation.

Just wanted to update on my experience with taxr.ai that was mentioned earlier. I was skeptical at first, but gave it a try with my complicated mixed-use apartment situation. I uploaded my floor plan and lease, and it actually provided a detailed analysis showing exactly how to calculate deductions for both dedicated and shared spaces based on square footage AND usage time. The best part was it flagged that I was calculating utilities incorrectly - turns out I could deduct a higher percentage than I thought. It saved me from a potential audit flag by making sure my deduction was accurately calculated but still maximized. Definitely helpful for situations like the original poster's question about partial rent payments and separate parking fees.

If you've been trying to reach the IRS to get clarification on home office deductions, good luck with that! I tried for weeks last tax season with no success. Then I found https://claimyr.com and used their service to get through to an actual IRS agent. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was specifically confused about vehicle expenses related to a home office (similar to your van situation) and needed clarification on how to separate those expenses. The IRS agent I spoke with confirmed that parking for a dedicated business vehicle should be listed separately on Schedule C, not as part of the home office calculation. She also explained the documentation I needed to keep to support both deductions.

I have to publicly eat my words on this one. After my skeptical comment above, I tried the Claimyr service out of desperation when dealing with a complex amended return question (couldn't get clear guidance from my tax software). Got a call back in about 45 minutes with an actual IRS rep on the line. The agent walked me through exactly how to handle my situation with business expenses split between home office and separate Schedule C deductions. Saved me hours of frustration and possibly an incorrect filing. For specific situations like the home office with split rent that OP described, getting direct IRS confirmation is really valuable.

Don't forget about the simplified option for home office deduction! Instead of calculating all these percentages for rent, utilities, etc., you can just take $5 per square foot up to 300 square feet. If your office is around 13% of your apartment, figure out the actual square footage and see if the simplified method might be easier. The simplified method is way less paperwork and doesn't require tracking all these individual expenses throughout the year. The downside is you might get a smaller deduction than the regular method, but it's worth calculating both ways to see which one benefits you more.

Make sure your home office truly qualifies before taking any deduction! The space must be used EXCLUSIVELY for business - meaning no personal use whatsoever. If you sometimes use that second bedroom for guests, storage of personal items, or anything non-business related, you could lose the entire deduction if audited. I learned this the hard way - had a dedicated office but kept a futon in there for occasional guests. Auditor disallowed my entire home office deduction because it wasn't 100% exclusive business use. Document your setup with photos showing it's clearly a workspace only.

I'm in a similar situation with a shared apartment but hadn't thought about the exclusive use requirement that Sofia mentioned. Since you mentioned the second bedroom is "exclusively used" for your business, make sure you can truly prove that if audited. One thing I'd add to the great advice already given - keep detailed records of everything. Take photos of your office setup, save all rent receipts, and document that 13% square footage calculation with measurements and a floor plan sketch. The IRS loves documentation, especially for home office deductions. Also, double-check your state tax rules too. Some states have different requirements or don't allow the federal home office deduction, so you might need to calculate things differently for state vs federal returns. For your van parking expense, definitely keep that separate on Schedule C as others suggested. That $125/month adds up to $1,500 annually, which is a solid business deduction you don't want to dilute by mixing it into your home office calculation.