Working from home can have its advantages but the IRS requires that the rules are followed. Deviations from the rules are grounds for audits and tax penalties that no one wants to endure when starting a new business. It's important to understand the rules for use and for deductions before you are too far into your new office space.
Deductions for the business use of your home can be considerable and worth taking if certain rules are followed.
Large additions and remodeling for the business can be depreciated along with furniture and office equipment. The assets purchased may be written off completely under Section 179 if the business is profitable in the year of purchase.
Daycare providers have special rules when calculating the percentage of business use. The percentage must take into account the hours worked as a daycare provider.
When is it time to move out of the house and rent office space or buy a building?