Can you deduct Home Office expenses on a Schedule E?

[mac20coaching]

There is no LLC, Corporation, or Partnership established.

[Just-Lisa-Now-]

If they legitimately have a dedicated office space they use only for business, its possible.

Sch E doesnt link to the 8829 though.

Ive used a dummy Sch C to complete the 8829, print it out then delete the C and 8829 and enter the OIH expense on Sch E as Other Expenses. I keep the printed 8829 in the client file just in case IRS ever questions how we came up with the figure.

[Norman2001]

If you're using the actual expense method, Lisa has a good technique.

I typically use the simplified method and double click on the amount in the other expenses section of Sch E. In the comment section enter area of office and house. Since there is no error checking, remember the maximum office area is 300 sq. ft. translating to $1500. 

[TaxGuyBill]

The rentals would need to rise to the level of a Business in order to qualify for the deduction.

The deduction would need to be split between the rental properties.

[ShoeBox Taxes]

All of the previous responses are great. I've also seen an additional line on Sch. E p. 2 for "Partnership Expenses" that could be utilized for this purpose. 

Here's the big question: What did they do last year? If this is the first year, I'd be hesitant to allow it for the reasons TaxGuyBill gave. If they did it last year, then just follow the same method, and keep impeccable notes in your work papers.

Why did the accountant cross the road? Because they looked in his PY work papers, and that's what they did last year.