Can I Deduct My Rent on My Tax Return?

by Van Thompson

Renting offers few tax benefits, which is one of the many reasons people choose to buy a home. You can't deduct the cost of rent on your taxes unless you have a home office used solely for business purposes. If you pay rent on a separate office, you may also deduct the cost of rent as a business expense.

Rent Deduction Basics

You can't generally deduct the cost of rent on your tax returns unless you meet a limited number of business-related exceptions. If you purchase a home, however, you can deduct your home mortgage interest and may be able to take advantage of first-time homebuyer tax credits.

Office Rent

If you rent an office space for your business, you can deduct the cost of rent from your taxes so long as you are the person paying rent and you are not being reimbursed for rent expenses. You may also deduct any property taxes you pay either to the lessor or to the government. Deduct this cost on Schedule C.

Home Office

If a space in your home is used solely for the purpose of conducting business, you may deduct a portion of the rent equal to the size the office is relative to your house. For example, a 100 square foot office in a 1000 square foot home would enable you to deduct 10 percent of your rent payments from your total tax liability. Self-employed people must deduct home offices on Schedule C, while employees may itemized a home office deduction on Schedule A.

Other Possible Deductions

If you have to move for your job, you can't deduct rent, but you can deduct many travel-related expenses such as mileage. Hotel rent is a deductible expense when you are traveling for your job. You can also deduct the costs of utilities in your home office or leased office space as business expenses on Schedule C.

About the Author

Van Thompson is an attorney and writer. A former martial arts instructor, he holds bachelor's degrees in music and computer science from Westchester University, and a juris doctor from Georgia State University. He is the recipient of numerous writing awards, including a 2009 CALI Legal Writing Award.

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