Mystery: Your CPA may inform you that there is no home use office form 8829 in corporation tax return. Accordingly, it is not possible to claim the home use office expenses.
Answer: This is not true as long as your company can setup an accountable plan (Reg. Section 1.62-2(c)(2)) to reimburse the employee (also the owner of the corporation) who has incurred the expense in performance of the work and those expenses can be substantiated by receipts and the calculations through form 8829 (the form is not required to file to IRS though, just keep it internally for reimbursement purpose).
In order for the owner of the corporation to reimburse the home use office expense, the owner has to use the home use office regularly and exclusively for the business. Also, the use of it is for the convenience of the employer. In order to survive in case of audit, we recommend the corporation issue a letter to document the reasons why it is required for the owner to work at home office. Again, the reason(s) must be to the benefit and convenience of the employer.
Tax saving: if the reimbursement to home use office is $500 / month (or $6,000 / year), assuming the taxpayer is in 25% tax bracket, the tax saving would be about $1,500 annually. The way to report it is to claim it under the corporation return as business expense. However, this payment to the owner is not needed to report as income because it is only reimbursement.
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