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How to Generate Form 8829 for Business Use of Home in Lacerte

by Intuit•1• Updated 2 months ago

How to Generate Form 8829 for Business Use of Home in Lacerte

To generate Form 8829:

  1. Go to Screen 29, Business Use of Home (8829).
  2. Select the applicable Form (Ctrl+T) from the drop down menu.

    Note- If Schedule C is not selected, Form 8829 will not be generate. Instead a Business Use of Home Worksheet will generate.

  3. Select the Activity name or number (Ctrl+T) from the drop down menu.
  4. Scroll down to the Business Use of Home (8829) section.
  5. Enter the Business use area (sq. ft.).
  6. Enter the Total area of home (sq. ft.).
  7. Enter the Total hours facility used (daycare facilities only).
  8. Scroll down to the Indirect Expenses section.
  9. Enter all applicable indirect expenses in full (business percentage will be applied).
  10. Scroll down to the Direct Expenses section.
  11. Enter all applicable expenses (business percentage will not be applied to direct expenses).
  1. Open Screen 22, Depreciation.
  2. Click Business Use of Home in Form (Ctrl+T).
  3. If there are multiple homes on Screen 29, Business Use of Home (8829), enter the number of form to which the asset relates in Activity Name or Number.
  4. Select a category of Buildings, Improvements, or Land, as applicable. Enter the remaining information required to depreciate an asset.

If the depreciation does not flow to the Form 8829 or Business Use of Home worksheet, check:

  • An entry of 1 is not entered in 1 = delete this year, 2 = delete next year (Screen 29, code 100).
  • The asset is tied to the correct Form (Ctrl+T) (Screen 22, code 18).  Business Use of Home (10) needs to be selected in this field.
  • In Forms mode, review the current-year Depreciation Schedule to ensure the asset is calculating depreciation.
  • In Screen 29, Business Use of Home, in the Depreciation section, make sure there are no depreciation overrides: for instance, Depreciation Percentage (xx.xxx)[O] or Depreciation Allowable [O].
  • In Forms view, check the regular depreciation schedule to compare depreciable basis, business use percentage, and prior depreciation. If the entire business-use portion of basis has been depreciated, then no more depreciation is allowed.

Note: Depreciation of Home Office for Multiple Schedule C Activities

Lacerte cannot split home depreciation between multiple Schedule C activities. If depreciation must be split, then override depreciation as a direct expense on each Schedule C. The total override amounts should equal the total allowed depreciation calculated by Lacerte.

To enter Form 8829 for a partial year:

  1. Navigate to Screen 29, Business Use of Home (8829)
  2. Enter the Form and Activity name or number to tie the Form 8829 to the appropriate business.
  3. Enter the Business use area (sq. ft.) and Total area of home (sq. ft).
  4. Enter any other applicable information for Form 8829.
  5. Enter only the expenses for the portion of the year that the home was used for business. Indirect expenses will have the Business Percentage applied to the amount entered. Direct Expenses will not have the Business Percentage applied.

For calculations related to Depreciable Assets go to Screen 22, Depreciation. Enter the number of months in the Additional Information section under Number of months if short year for each asset involved in the business use of home.
The program will calculate the business use percentage by the square footage to apply to the expenses entered for the home.

Indirect Expenses

Enter the indirect expenses in full (see the note below for exceptions). The program applies the business percentage and carries to Schedule A the nondeductible portion of interest, taxes, and casualty loss.


Direct Expenses

Enter in the appropriate input fields direct expenses related to the business use of the home. The program does not limit direct expenses related to the business activity on Form 8829. The program deducts the amounts entered in full.

Note:  If the taxpayer is subject to Excess Home Mortgage limitations, input fields are provided at the bottom of the Itemized Deductions input screen allowing you to enter loan information, including interest and points expense. If you are using that input section, you are also allowed to route the allowed interest and points expense from those loans to the 8829/Business Use of Home Worksheet. If you do this, do not make entries in the Mortgage Interest [A] (Screen 29) or Excess Mortgage Interest [A] (Screen 29 ) input fields on the Business Use of Home screen.

Note: If any fields in the Mortgage Interest section are overridden, then all fields there must be overridden.

Business use of home input is generating the following diagnostic:

Allocate expenses from multiple homes to one business

  1. Navigate to Screen 29, Business Use of Home 
  2.  Enter the information applicable to the first home with a home office.
  3.  In the Allocation Section enter the percentage of income that was earned using the first home office in the field Percentage (.xx) or amount of gross income from Schedule C,E,F, etc. if not 100% (-1 if none)
  4.  Enter the percentage of expenses from the first home office in the field  Percentage (.xx) or amount of expenses from Schedule C,E, and F, etc. if Not 100% (-1 if none)
  5. In the Home List, click the Add button.
  6. Enter the information for the second home as listed in steps 1 through 4 to allocate the income and deductions between the homes, making sure that the percentages entered equal 100%.
Lacerte Tax 2020

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