Hi everyone,
Do any of you have some sample text you use with members of your space to promote (and make them aware) of the tax advantages of working in a coworking space?
I want to alert our members that their membership (and punchcards) can be tax deductible if it’s a business expense for them – I believe this applies to those who freelance, run their own company or even use the space as their office when they’re working remotely for another company. Is this all indeed correct? I checked with a local accountant and he seemed to think this was all legitimate.
We just opened last summer, so I’m looking for any recommendations – as tax season will be upon us shortly!
Thanks in advance.
Lauren McDaniel
Lauren,
Any expense directly related to operating a business is tax deductible as a business expense. That would include membership fees, “day passes”, meeting room rentals or any other expense incurred for the business. Those that work from home can also claim a deduction for a home office, but conventional wisdom says that deduction is one of the flags for an audit. So, the advantage of claiming monies paid to a coworking space / community is really more that it is a cleaner way of claiming “office” expenses. The statements, receipts or invoices from the coworking space / community provide a clear record of the expense and, because it is separate from any use of a space for personal reasons (like a room at home might be) there’s a clean delineation of the business expense.
Hope that helps.
Julia
···
On Friday, January 27, 2017 at 3:43:51 PM UTC-5, Lauren McDaniel wrote:
Hi everyone,
Do any of you have some sample text you use with members of your space to promote (and make them aware) of the tax advantages of working in a coworking space?
I want to alert our members that their membership (and punchcards) can be tax deductible if it’s a business expense for them – I believe this applies to those who freelance, run their own company or even use the space as their office when they’re working remotely for another company. Is this all indeed correct? I checked with a local accountant and he seemed to think this was all legitimate.
We just opened last summer, so I’m looking for any recommendations – as tax season will be upon us shortly!
Thanks in advance.
Lauren McDaniel
I forgot to give you the language we use. We simply say that one of the benefits of coworking is “Tidy Tax Records” and explain that the statements we provide give a clear record of their monthly expense and avoids the hassle of figuring out the proper amount (and avoids IRS scrutiny) of a home office deduction.
···
On Saturday, January 28, 2017 at 1:31:39 PM UTC-5, Julia Ferguson wrote:
Lauren,
Any expense directly related to operating a business is tax deductible as a business expense. That would include membership fees, “day passes”, meeting room rentals or any other expense incurred for the business. Those that work from home can also claim a deduction for a home office, but conventional wisdom says that deduction is one of the flags for an audit. So, the advantage of claiming monies paid to a coworking space / community is really more that it is a cleaner way of claiming “office” expenses. The statements, receipts or invoices from the coworking space / community provide a clear record of the expense and, because it is separate from any use of a space for personal reasons (like a room at home might be) there’s a clean delineation of the business expense.
Hope that helps.
Julia
On Friday, January 27, 2017 at 3:43:51 PM UTC-5, Lauren McDaniel wrote:
Hi everyone,
Do any of you have some sample text you use with members of your space to promote (and make them aware) of the tax advantages of working in a coworking space?
I want to alert our members that their membership (and punchcards) can be tax deductible if it’s a business expense for them – I believe this applies to those who freelance, run their own company or even use the space as their office when they’re working remotely for another company. Is this all indeed correct? I checked with a local accountant and he seemed to think this was all legitimate.
We just opened last summer, so I’m looking for any recommendations – as tax season will be upon us shortly!
Thanks in advance.
Lauren McDaniel
Julia,
I appreciate the clarification and advice, it really helps!
Thank you!
Lauren
···
On Saturday, January 28, 2017 at 11:38:47 AM UTC-7, Julia Ferguson wrote:
I forgot to give you the language we use. We simply say that one of the benefits of coworking is “Tidy Tax Records” and explain that the statements we provide give a clear record of their monthly expense and avoids the hassle of figuring out the proper amount (and avoids IRS scrutiny) of a home office deduction.
On Saturday, January 28, 2017 at 1:31:39 PM UTC-5, Julia Ferguson wrote:
Lauren,
Any expense directly related to operating a business is tax deductible as a business expense. That would include membership fees, “day passes”, meeting room rentals or any other expense incurred for the business. Those that work from home can also claim a deduction for a home office, but conventional wisdom says that deduction is one of the flags for an audit. So, the advantage of claiming monies paid to a coworking space / community is really more that it is a cleaner way of claiming “office” expenses. The statements, receipts or invoices from the coworking space / community provide a clear record of the expense and, because it is separate from any use of a space for personal reasons (like a room at home might be) there’s a clean delineation of the business expense.
Hope that helps.
Julia
On Friday, January 27, 2017 at 3:43:51 PM UTC-5, Lauren McDaniel wrote:
Hi everyone,
Do any of you have some sample text you use with members of your space to promote (and make them aware) of the tax advantages of working in a coworking space?
I want to alert our members that their membership (and punchcards) can be tax deductible if it’s a business expense for them – I believe this applies to those who freelance, run their own company or even use the space as their office when they’re working remotely for another company. Is this all indeed correct? I checked with a local accountant and he seemed to think this was all legitimate.
We just opened last summer, so I’m looking for any recommendations – as tax season will be upon us shortly!
Thanks in advance.
Lauren McDaniel