Common Question About Home-Office Deductions for this Medical Professional
Q&A: Home-Office Deduction for Orthodontist
Question: Bob, an orthodontist, wants to claim a home-office deduction. His employees and contractors do the billing and accounting for his practice. Bob and his wife (who is an employee) do payroll once a month in the home office. Bob’s primary use of the home office is preparing treatment plans for his patients. My concern is whether the preparation of treatment plans is an administrative or a management activity. Can you give us your opinion?
General Rules for Home-Office Deductions
Here are the answers to your home-office deduction question and some rules of the road for other medical professional’s home-office deductions:
- Look at the tax filer only. Bob’s staff does not impact his ability to claim a home-office deduction. In other words, the law doesn’t care what his staff does.
- To get this home office right, Bob should consider doing all of his administration at home. He should make his practice office his patient office—nothing more, period.
- Preparing treatment plans meets the rules for administrative use of the home office. For details on this, see Putting the IRS Audit Manual’s Home-Office Section to Work for You.
- To know for certain that administrative use qualifies, see Home–Office Deduction—Show Me the Proof!
- Bob needs to meet the regular-use requirement. For more on regular use, see What Qualifies as Regular Use for the Home-Office Deduction?
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