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10 IRS Rules for the Home Office Deduction

        Money | Taxes

5
Storing Inventory
Storing inventory in your closet? It's work space. luanateutzi/iStockphoto/ThinkStock
Storing inventory in your closet? It's work space. luanateutzi/iStockphoto/ThinkStock

Remember how the IRS insisted you had to use your home office exclusively and regularly no matter what to get a deduction? There are actually a couple of ways you don't have to meet that test to get your deduction. The first is if you run a daycare. (We won't get too far into that, because it's a really complicated deal.) But the other option might be more inclusive and fairly easy to meet.

If you're using part of your house for inventory storage or product samples, you can deduct the space. Keep in mind there are still some requirements: You have to sell products at wholesale or retail for your business, your home is the only (fixed) location of your business, you use the storage space consistently and the space is identifiable as a storage space. Obviously, the products must also be kept in your home.

So if you're selling water bottles door to door (I don't know your life) and keep all your supplies stored in one room of your house (or even a separate portion of your basement), you can write off some of the qualifying expenses.


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