Tax & AccountingAugust 20, 2020

IRS Releases Draft Form 8829 (expenses for Business Use of Home)

IRS Releases Draft Form 8829 (expenses for Business Use of Home)

The IRS has just released Draft Form 8829 (Expenses for Business Use of Home). Note the PPP deductibility reminder from the IRS. https://www.irs.gov/pub/irs-dft/i8829–dft.pdf

Expenses Related to a Forgiven Paycheck Protection Program (PPP) Loan

Generally, you can’t deduct expenses that are allocable to income that is exempt from taxation. If you received a PPP loan under section 7(a)(36) of the Small Business Act, expenses for the business use of your home paid with proceeds from that loan can’t be deducted to the extent the loan was forgiven. These expenses include, but are not limited to, the following:

  • Interest on a mortgage.
  • Rent.
  • Utilities.
  • Reduce expenses by the amounts you can’t deduct as a result of a forgiven PPP loan before figuring amounts to report in Part II.

For more information, see Notice 2020-32. Notice 2020-32 is available at https://IRS.gov/irb/2020-21_IRB#NOT-2020-32.

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Mark Friedlich
Author at Tax & Accounting
Mark Friedlich, a CPA & tax lawyer, is the principal international & corporate indirect taxation analyst for Wolters Kluwer Tax & Accounting. He is a member of the U.S. Senate Finance Committee’s Chief Tax Counsel’s Advisory Board, advisor to 14 state taxing authorities, and a member of the American Bar Association’s Tax Section and AICPA’s Tax Section leadership teams. Prior to joining Wolters Kluwer he was a Managing Tax Partner at PricewaterhouseCoopers.