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Can I deduct rent and utilities paid on a leased apartment while working out of state on temporary jobs

Newport Beach, CA |

I have leased an out of state apartment and pay renter's insurance and utilities on this apartment while working out of state while still paying a mortgage and taxes and insurance on my home in my resident state. I return to my resident home 1 to 2 times per year. Can I deduct the out of state rent and utilities and renter's insurance paid?

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Attorney answers 3

Posted

Disclaimer: The materials provided below are informational and should not be relied upon as legal advice.

You do not provide sufficient facts. You are likely deducting your mortgage payments on the theory that the house is your primary residence. If you are spending so much time out of state, that brings into question whether your mortgage is still deductible under that theory. Regardless, your out of state living/lodging costs may be considered work expenses. I suggest you go over the facts and circumstances in detail with your CPA, or other tax advisor to protect your legal rights.

Posted

No, your out of state rent, utilities and renter's insurance are not deductible unless the leased property is used for business, and even so, you may only deduct only the amount used for business. See:

http://www.irs.gov/newsroom/article/0,,id=168009,00.html

The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author (who is only admitted to practice law in the State of California). For specific advice about your particular situation, consult your own attorney.

Posted

What is your out of state working situation? Contractor? Contractor servicing several clients? Do you keep client records in the out of state apartment (and thus the reason for insurance)? Do you have commercial liability insurance? Do you file a schedule C on the work income?

These are the sort of questions that need to be asked.

Curt Harrington Patent & Tax Law Attorney Certified Tax Specialist by the California Board of Legal Specialization PATENTAX.COM This communication is general information and not legal advice, and does not create an attorney-client relationship. This communication should not be relied upon as any type of legal advice. Please note that no attorney-client relationship exists between the sender and the recipient of this message in the absence of either (1) a signed fee contract and (2) remission of an agreed-upon retainer. Absent such an agreement and retainer, I am not engaged by you as an attorney, nor is any other member of my law firm.

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