Message Font: Serif | Sans-Serif
 
No. of Recommendations: 1
<<My daughter is establishing a home-based graphic design studio. I facilitate her by doing a variety of things which help her business.>>

Good for your daughter...and for you. Good luck to you both.

<<I have been told that she will be able to get no home office write-off advantages bcause our mortgage happens to be in my name.>>

If she doesn't own the home, not is she legally obligated to make the payments (i.e., the loan is in your name only), then it would be difficult to take an office in home deduction...at least for the mortgage interest.

<< I wonder if we should establish a partnership instead of a sole proprietorship. I am retired with a pension and am required to withdraw from my IRA each year. I could certainly use some tax advantage myself.>>

But the deduction that the partnership would take would be offset by the RENTAL INCOME that you'd have to report on your tax return...since you're now renting the office to the partnership. So the only advantage would be to your daughter...and no advantage to you.

<<Might a partnership be a good idea or are there tax disadvantages I'm not aware of?>>

I don't much like partnerships in any event, simply from the liability standpoint. And this seems like just too much work to generate the office in home deduction...which generally itsn't that big of a deal anyway. If you would like to read more about the office in home deduction, check out my article in the Taxes FAQ area.

TMF Taxes
Roy
Print the post  

Announcements

Disclaimer:
In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.