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kristinehammond
Level 1

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

 
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Best answer March 08, 2020

Best Answers
JamesDuanT
Moderator

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Hello kristinehammond,

 

Yes, you can enter the full amount like you did for the mortgage interest or the office square footage. You jsut need to ensure that the transactions are categorized properly. All the necessary details are already provided by RenjolynC. You can use those links for reference to complete the activities.

 

We'll be right here if you require additional assistance in managing your transactions.

View solution in original post

7 Comments 7
RenjolynC
QuickBooks Team

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Yes, you will need to enter the full amount you've paid, kristinehammond.

 

QuickBooks Self-Employed will then calculate your taxes based on the home office size that you've set up. 

 

I've got these articles that discuss more about the process:

 

Please let me know if you need anything else. I'll be around to help you some more. Thanks.

kristinehammond
Level 1

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Thanks!  Do I do the same for utilities, property taxes, homeowners insurance? Essentially all of the home office expenses in full and let QBSE do the calculation?

JamesDuanT
Moderator

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Hello kristinehammond,

 

Yes, you can enter the full amount like you did for the mortgage interest or the office square footage. You jsut need to ensure that the transactions are categorized properly. All the necessary details are already provided by RenjolynC. You can use those links for reference to complete the activities.

 

We'll be right here if you require additional assistance in managing your transactions.

View solution in original post

Jaydra
Level 1

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Hi RenjolynC -

 

I saw your response to another community member here about the Home Office, so went back to re-adjust all of my home office rent business expenses for 2019. (I had originally been calculating the home office percentage myself by entering it as a manual cash "Business" expense of $342 each month (which is 34% of my total monthly rent of $1700 -- office takes up 34% square footage, and the sq. footage method is the one I want to use).

 

However, after reading your post and going back and re-adjusting every entry back up to $1700, I noticed that that drastically reduced my profit and loss numbers, which confused me. I am wondering how QuickBooks Self-Employed takes into account the 66% of my rent that is personal.

 

(I am currently taking a monthly Personal Withdrawal and paying my full rent out of a personal banking account that is not connected to QuickBooks Self-Employed at all (so do I need to connect this personal savings account to the app as well, or do I enter the personal savings into TurboTax later once QuickBooks exports in the Schedule C data?)

 

What am I doing wrong? Thanks in advance!

MarsStephanieL
QuickBooks Team

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Let me share some details about the Home Office related transactions, Jaydra.

 

You'll want to enter the amount in full for the monthly rent paid (added up until the last payment for the whole year's rent). You'll want to avoid recording monthly amounts. The system will automatically recognize the transaction for the Home Office as the total annual rent.
 

To correct this, you can delete it right away especially when it’s added manually. Also, QuickBooks Self-Employed Profit and Loss Report don’t concern Home Office-related transactions because the P&L report only accounts for your daily expenses or transactions and not the yearly transactions. So when you pull up the P&L report, Home Office is not visible.
 

For additional insights, you can refer to my colleague, @RenjolynC's articles.

 

Let me know if you need further assistance. I'm ready to back you up. Have a good one.

Jaydra
Level 1

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Thanks very much! Just to be clear, I have a few more questions: 

 

1) You are directing me to delete, in my Quick Books Self-Employed app, all 12 monthly transactions and instead manually add a single ”Business” expense for the whole year (see screenshot attached) *even though* I paid all of my rent out of my personal banking account, which is not connected to QBSE?

 

2) A couple of questions re: RenjolynC’s linked articles. Do we record the home office square footage in QBSE (under Taxes>Annual Taxes>Home Office) *regardless* of if we plan to use the simplified or actual expenses method? Or just with one method?

 

3) The article states: ”For annual taxes, it's a good idea to categorize expenses for your home into our special home office categories. That way, at annual tax time, you'll have the totals needed for TurboTax...”.

 

Are the totals of annual home office rent (and utilities) automatically exported into TurboxTax (Assuming we have categorized them like you instruct in Question #1)? If not, where and what form exactly do we use to enter them?

 

Many, many thanks in advance!

 

JonpriL
Moderator

Should I enter in the full amount of mortgage interest or just the amount pertaining to my office square footage? (Does QBSE do the calculation or should I, then enter in that amount?)

Recording your home office rent as a single business expense will also create a one-time deduction, @Jaydra.

 

You're on the right track in entering your home office square footage on the Taxes page. Once you're about to submit your tax summary, your total annual office rent included in the file.

 

But I'd still recommend contacting our TurboTax Support for guidance in choosing the right method of deduction and how it works. You can reach them through his link: TurboTax Support.

 

I'm also adding a reference here about how you can manage your self-employed account and other related tasks.

 

If there's anything else that I can help you with, let me know in the comments. Thanks!

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