HOPE2
Level 9
03-06-2025
02:47 PM
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Hi to all,
If a client does not use the Simplified Method and does not depreciate the space used as a home office, does the IRS calculate this part on its side?
Thanks for your help!
Best Answer Click here
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IRonMaN
Level 15
03-06-2025
03:15 PM
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No, but if they sell the home, the depreciation gets recaptured whether or not it was claimed on their tax returns.
Slava Ukraini!
TaxGuyBill
Level 15
03-06-2025
08:24 PM
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I'm going to partially disagree with Jeff's answer.
While the depreciation (whether claimed or not) does lower Basis, the §121 exclusion can exclude that gain if the depreciation was not actually taken (if the total gain is within the §121 limits)
With that being said, the depreciation usually lowers both income tax AND self-employment tax, so taking the depreciation is still best.
