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  1. #1

    Need Help calculating "Portion of home used for your business" in TurboTax

    If anyone has used Home and Business TurboTax 2013, online version.
    I need your help.. or if you're familiar with solving this question, your assistance is appreciated!

    I've inputted all my home expenses for the years of 2013 on the one page.
    There's a following page that is suppose to calculate the "portion of your home"

    The first section says
    Area, (mor ft) or number of rooms, of the workspace
    CRA requires you to use a reasonable estimate to calculate the deductible portion of your home expenses. This is normally the area of the workspace divided by the total area of the home, in square feet or meters. If you're unable to determine these measurements, you may instead use the number of rooms if the workspace rooms are of average size.
    ANSWER: _______

    The second section says
    Total area or rooms in the home (use the same unit of measurement as above)
    ANSWER: _______

    Followed by further information...
    Note: If you use the space for personal use as well, you need to further reduce your percentage by the amount of time you use the space for personal use.
    To calculate your percentage; take the area or number of rooms you use for business purposes divide by the total area or number of rooms in your home. Multiply that result by the number of hours in the day you use your home for business purposes divided by 24. And then, multiply that result by the number of days you use your home for business purposes divided by 366.
    To enter the calculation above, enter 100 in the Total area or rooms in the home. Enter the percentage calculated in the Area or number of rooms, of the workspace.

    I'm stumped! I opened part time in October
    My total house square footage is 1439 sqft
    Shared Space is 719.5 sqft (10hrs/day and was only 25days/yr)
    Daycare Only Space is 390 sqft

    So do I use the above formula provided in the "Notes"

    I come up with...
    SHARED SPACE
    (DC area used 719.5 divided by total area 1439) x (10hrs divided by 24hrs) x (25 days divided 366) = 0.0147

    DAYCARE ONLY SPACE
    (DC area used 390 divided by total area 1439) x (24hrs divided by 24hrs) x (25 days divided 366) = 0.0189

    Therefore I add those two answers (0.0336) and multiple by 100 to get a percentage = 3.36% ?????????

    "3.36" WOULD BECOME MY "First section ANSWER"
    AND
    "100" according the "notes" WOULD BECOME MY "Second Section ANSWER"

    Is Anyone else following, am I right? Please say yes!! LOL

  2. #2
    Euphoric !
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    daycare only doesn't get divided by hours used. it is assumed used 24/7 because you only use it for daycare. this will increase your final percentage.

  3. #3
    Quote Originally Posted by Lee-Bee View Post
    daycare only doesn't get divided by hours used. it is assumed used 24/7 because you only use it for daycare. this will increase your final percentage.
    Thanks for your reply Lee Bee!
    I've recalculated according to your input, but get the same number.
    At least I'm gaining more confidence, now that someone agrees with my numbers.

    Anyone else have an opinion???

  4. #4
    Euphoric !
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    :-) I see now that you had used 24hrs divided by 24hrs already!

    I guess since it was only Oct-Dec your percentage seems low. The rest looks good to me...but this is my first year so wait until tomorrow when all the long-term folks are on they will have better insight :-)

  5. #5
    Outgoing
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    I'm not an expert, this is my first year doing daycare taxes. What I'm wondering is why you have to do a calculation that has 25 days divided by 366. I understand why you did it, but what I sent my accountant was different. I opened last year, so I gave her my bills only for the months I was open. And I didn't worry about the part of the year i was not operating a daycare. So my calculation was based on 5 days a week, but I had less bills to claim because I wasn't open a full year.
    I hope I said that well enough. It's such a pain when I post from my phone instead of the computer.

    I wanted to add something after I read your post again. Based on what the tax program is explaining to you, i would guess that they assume you have been open for a full year. If it was me, I would use the amount of days you were open, and divide it by the total number of days available in the time you were open. Make sense?
    Last edited by superfun; 04-29-2014 at 08:47 PM.

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