What are the tax ramifications of an in-home business?

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What are the tax ramifications of an in-home business?

I’m a certified personal trainer and own a small personal training business that I operate from home. When I started the business I had an unfinished basement and decided to utilize the space to train my clients. I hired a contractor who finished the basement’ it cost me $48,000 in labor and materials and I spent an additional $6,000 in gym equipment. About 45% of the basement is utilized for running the business. I have a couple questions. Is any of that tax deductible? Also, am I required to submit a 1099 to the contractor for the cost of the project?

Asked on October 4, 2013 under Business Law, North Carolina

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Based upon what you have written about a portion of what you spent is deductible as a business expense on your taxes and you would be required to submit a 1099 to the contractor for work that he or she did on your property.


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