The question is really at what point does repair expenses (to be used as a business expense for the portion of the house that is the home office) become a home asset (and therefore not used as an expense, rather depreciated over time)?

TurboTax says: “Repairs for your entire home are those …including repainting your whole house (inside or out), or fixing your furnace. More extensive work, such as remodeling, or adding a new roof, should be added under the Asset sections.”

So… what is ‘more extensive work’ vs. just a repair? I got a new furnace. We had to replace the water line. All the paneling was replaced with drywall. We rebuilt the deck (where my clients come in). Where do these fall? These are the mysteries!

With respect to direct expenses (those that you mentioned were specifically for your home office), you would list those at 100%. With respect to indirect expenses (those, for example, like your furnace that affect the whole house), you would pro rate those expenses. Do not include expenses that are clearly not associated with the home office at all.

I have a home office. It’s 18% of my overall home sf. We recently completed an interior remodeling of my entire downstairs (where the home office is). We spent $100k.

So, do I enter $95k in the whole house repair expense (includes drywall, furnace, insulation, etc), and the $5k in the home office expense (that was specifically for paint, light fixtures, etc. of the office)? What about listing the total 100k remodel as an asset, in the home summary? Do I do both?

It makes a big difference on our refund amount. and while I want a nice refund, i dont want to be stupid and double-dip that’ll cause more problems or red flags later.