Which of the Following Statements Regarding the Home Office Deduction

question 50

Multiple Choice

Which of the following statements regarding the home office deduction is true?

• A) In order to qualify for the deduction, a portion of the taxpayer's home must be used regularly and exclusively to meet with clients or customers.
• B) A home office deduction is not allowed for using the home office for administrative or management activities only.
• C) The home office deduction is limited to the taxable income of the business before the deduction.
• D) A depreciation deduction is not allowed for a home office.

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Definitions:

Recorded

The process of recording business financial transactions into the accounting books.

Accrued Revenues

Revenues for services performed but not yet received in cash or recorded.

Received

Typically refers to the acknowledgement of having gotten something, such as goods or payments, within a business context.

Recognized

In accounting, recognized refers to the formal acknowledgment in financial statements that a transaction or event has impacted the entity's financial position or performance.