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HOME OFFICE TAX (tm) 1990
Version 1990.2A
Shareware Version
Copyright (c) 1987 - 1991
by ParyTech Associates
█████████████████████████████████████████████████████████████
█ █
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█ This version is an early release █
█ █
█ A final version will be released in early Jan 1991 █
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█████████████████████████████████████████████████████████████
_______
____|__ | (R)
--| | |-------------------
| ____|__ | Association of
| | |_| Shareware
|__| o | Professionals
-----| | |---------------------
|___|___| MEMBER
ParyTech Associates
16559 Quincy St. NE
Ham Lake, MN 55304
(612) 434-4330
CompuServe PPN: 76407,607
TABLE OF CONTENTS
SUBJECT PAGE
Introduction ........................................ 1
Copyright Notice ..................................... 2
Trademarks ........................................... 2
Disclaimer of Warranty ............................... 2
License .............................................. 3
Registration and Ordering ............................ 4
Quantity and Corporate Purchases ..................... 5
Shareware ............................................ 6
ASP Ombudsman ........................................ 8
Benefits to Registered Users ......................... 9
System Requirements .................................. 11
Installation ......................................... 12
Command Conventions .................................. 13
Help System .......................................... 13
Getting Out of an Area (ESCape!) ..................... 14
Information Needed for Data Entry .................... 15
Your Name ....................................... 15
Social Security Number .......................... 15
Total Square Footage of Home .................... 15
Square Footage of Office Space .................. 15
Average Hours per Week You Provided Day Care .... 15
Number of Weeks You Provided Day Care ........... 15
Home In-Service Date ............................ 16
Straightline Depreciation ....................... 16
Straightline Years (if ACRS property) ........... 17
Cost/Basis of Home .............................. 17
Mortgage Interest Paid .......................... 17
Property Tax Paid ............................... 17
Rent ............................................ 17
House Insurance Paid ............................ 17
Gas Utilities Paid .............................. 18
Electric Utilities Paid ......................... 18
Other Utilities ................................. 18
Indirect Maintenance Costs ...................... 18
Business Expenses ............................... 18
Business Gross Profit ........................... 18
SUBJECT PAGE
Casualty Losses ................................. 18
Indirect Expense Carry Forward from 1989 ........ 19
Depreciation Carry Forward from 1989 ............ 19
Schedule C or Form 2106 Filer ................... 19
Main Menu ............................................ 20
Print Input Form ................................ 20
Data Entry ...................................... 20
Print Reports ................................... 20
Worksheet .................................. 20
Filing Instructions ........................ 20
Data Entered ............................... 20
Tax Return Statement ....................... 20
Print All Reports .......................... 21
Main Menu .................................. 21
Configure System ................................ 21
Screen Colors .............................. 21
Snow Suppression ........................... 21
File Path .................................. 21
Printer Page Pause ......................... 21
Printer Ports .............................. 21
Return to Main Menu ........................ 22
OS Shell ........................................ 22
Exit to DOS ..................................... 22
Getting A File ....................................... 23
Depreciation Conventions Used ........................ 24
Calculation Methods ............................. 24
Periods Used .................................... 24
Conventions Used ................................ 24
Explanation of Reports ............................... 25
Worksheet ....................................... 25
Filing Instructions ............................. 29
Data Entered .................................... 29
Tax Return Statement ............................ 29
Registration Form .................................... 30
HOME OFFICE TAX 1990
INTRODUCTION
HOME OFFICE TAX is designed to take the drudgery and
headaches out of figuring home office expenses for tax
deductions by letting your computer do the hard work of
figuring the percentages and allowances.
In the past, the IRS has printed Publication 587
"Business Use of Your Home". While this publication is a
good effort on the part of the IRS, some people still have a
difficult time trying to decipher the instructions. In one
of their previous publications there was an error in
reference to the amount of gross business income, and a non-
existent line number was referenced. This caused some errors
on some tax returns of the taxpayers who did not happen to
catch these instruction errors, which required amended
returns to be filed. Actually, it caused people to pay more
tax than was necessary. The IRS did correct this problem,
although a little late for some people.
HOME OFFICE TAX uses a modified approach to the IRS
worksheet to present information more logically. You are
asked to enter information on your home office space and
expenses. HOME OFFICE TAX asks you for the basic raw data,
total amounts spent on various items, then computes your
business percentages and depreciation based on your home
office space footage. HOME OFFICE TAX then prints a report
detailing your deduction and limitations (if any), and carry
forward's of expenses (if any).
We hope this program will appear very simple in nature.
That was our purpose. Most of the program code involves
depreciation calculations by the computer that the user
doesn't see going on. This program will calculate all
depreciation methods for real estate going back to the
1940's.
This manual is brief. We designed the program for
maximum ease of use so that detailed instructions will not be
required.
This manual assumes that you have rudimentary knowledge
of using MS-DOS systems. Certain file functions have not
been provided for because they are easily accomplished with
DOS commands (DELete, REName, COPY), and can be done through
the Operating System Shell (OS Shell) at the Main Menu.
┌─────────────────────────────────────────────────┐
│ CHANGES SINCE THE 1989 VERSION: │
│ │
│ - Selection bars in menu's. │
│ - Ability to cancel printing │
│ - Ability to selectively print reports │
│ - Faster access to the data entry screen │
│ - Better use of colors │
│ - Better placement of menu's │
│ - Ability to define printer ports │
│ - Better error trapping │
│ - Election to take a depreciation deduction │
│ on your home │
│ │
└─────────────────────────────────────────────────┘
- 1 -
HOME OFFICE TAX 1990
COPYRIGHT NOTICE
HOME OFFICE TAX is copyrighted by ParyTech Associates.
No parts of HOME OFFICE TAX or the manual may be copied
in whole or in part, except as provided in the License in the
following pages.
TRADEMARKS
HOME OFFICE TAX is Trademarked by ParyTech Associates.
Many product names found throughout this manual are
trademarks of various companies.
DISCLAIMER OF WARRANTY
THIS SOFTWARE AND MANUAL IS SOLD "AS IS" AND WITHOUT
WARRANTIES AS TO PERFORMANCE OF MERCHANTABILITY OR ANY OTHER
WARRANTIES WHETHER EXPRESSED OR IMPLIED. BECAUSE OF THE
VARIOUS HARDWARE AND SOFTWARE ENVIRONMENTS INTO WHICH THIS
PROGRAM MAY BE PUT, NO WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE IS OFFERED.
GOOD DATA PROCESSING PROCEDURE DICTATES THAT ANY PROGRAM
BE THOROUGHLY TESTED WITH NON-CRITICAL DATA BEFORE RELYING ON
IT. THE USER MUST ASSUME THE ENTIRE RISK OF USING THE
PROGRAM. ANY LIABILITY OF THE SELLER WILL BE LIMITED
EXCLUSIVELY TO PRODUCT REPLACEMENT OR REFUND OF PURCHASE
PRICE.
- 2 -
HOME OFFICE TAX 1990
LICENSE
HOME OFFICE TAX (tm) is copyright (c) 1987 through 1991
by ParyTech Associates.
HOME OFFICE TAX is not, nor has ever been, public domain
or free software.
The commercial, registered version of HOME OFFICE TAX
may not be duplicated other than for backup purposes. A
registered copy of HOME OFFICE TAX must be treated like a
book, in that the same registered copy of HOME OFFICE TAX may
not be used in more than one computer at the same time, just
as a book may not be read by more than one person at the same
time.
Users are granted a limited license to use the User
Supported (Shareware), trial version of HOME OFFICE TAX for a
limited evaluation period of up to 30 days, in order to
determine if it suits their needs. Any other use of HOME
OFFICE TAX or use past this period requires registration.
All users are granted a limited license to copy the User
Supported (Shareware) version of HOME OFFICE TAX only for the
purpose of allowing others to try it, subject to the above
restrictions as well as the following:
HOME OFFICE TAX must be distributed in absolutely
unmodified form, including ALL program, documentation, and
other files.
HOME OFFICE TAX may not be included with any other
product for any reason whatsoever without a license from
ParyTech Associates.
No charge or payment may be levied or accepted for HOME
OFFICE TAX.
Bulletin Board system operators may post the User
Supported version of HOME OFFICE TAX on their BBS for
down loading by their users without written permission only
if the above conditions are met, and only if no special fee
is necessary to access the HOME OFFICE TAX files (a general
fee to access the BBS is OK).
Distributors of User Supported and Public Domain
software MUST obtain written permission from ParyTech
Associates before distributing HOME OFFICE TAX and must
follow the above conditions. Permission is almost always
granted. This requirement is necessary to ensure protection
for ourselves and HOME OFFICE TAX users from unscrupulous
individuals.
Approved Vendor Members of the Association of Shareware
Professionals (ASP) are automatically granted permission to
distribute HOME OFFICE TAX for as long as they remain members
of ASP in good standing.
- 3 -
HOME OFFICE TAX 1990
REGISTRATION AND ORDERING
Registering HOME OFFICE TAX allows you to use the
product after the trial period. Registered HOME OFFICE TAX
users get the current copy of HOME OFFICE TAX on disk along
with their own serial number, mailed notification of HOME
OFFICE TAX updates, priority when calling for support, and a
free subscription to the ParyTech Update newsletter which is
published quarterly. Most importantly, registered users know
they are helping to make sure that high quality software like
HOME OFFICE TAX continues to be sold in this low cost manner.
HOME OFFICE TAX registration costs $18 in U.S. funds,
and includes a copy of HOME OFFICE TAX on disk and a free
update for the next version (although a $5 postage and
handling fee will be charged on the free update). Check and
money orders are accepted but must be in U.S. funds drawn on
a U.S. bank. Purchase Orders are not accepted. Orders for
quantities in excess of 10 copies (which qualifies for a
discount) must be accompanied by a secured check (money order
or cashier's check).
An evaluation disk with the current copy of HOME OFFICE
TAX is available for $5. This is to be used to try out HOME
OFFICE TAX, and does not include registration. The fee
covers the cost of postage & handling, and diskettes.
To place an order, please use the order form at the end
of this documentation.
CORPORATIONS and INSTITUTIONS: please see the section
titled 'Quantity and Corporate Purchases' for information on
licensing multiple copies of HOME OFFICE TAX. Under no
circumstances may an unregistered copy of HOME OFFICE TAX be
used in a corporate or institutional environment after the
trial period is over.
- 4 -
HOME OFFICE TAX 1990
QUANTITY AND CORPORATE PURCHASES
Any commercial (business, corporate, government, or
other institutional) use of HOME OFFICE TAX must be
registered. Volume discounts and site licenses are
available.
The order form at the end of this documentation may be
used to purchase multiple copies of HOME OFFICE TAX with
discounts as follows:
1 to 10 copies no discount
11 to 20 copies 10% discount
21 to 50 copies 15% discount
51 to 100 copies 25% discount
101 + copies 40% discount
Purchases of up to 50 copies are bulk purchases and
include that many copies of HOME OFFICE TAX on disk as with
single registrations. Purchases of 51 or more copies are
site licenses. ParyTech Associates provides a master copy of
HOME OFFICE TAX and the appropriate number of diskette
labels. The licensee is responsible for copying the disks
(backups of the MASTER do not count towards the total copies
in the license).
The name on the order form is considered the contact and
is the person with whom all correspondence will take place.
NOTE: All prices and discounts are subject to change without
notice. Discounts only apply to separate orders and
are not cumulative.
- 5 -
HOME OFFICE TAX 1990
SHAREWARE
You have probably heard the terms "public domain",
"freeware", "shareware", and others like them. Your favorite
board probably has many programs described by one or more of
these words. There's a lot of confusion about and between
these terms, but they actually have specific meanings and
implications. Once you understand them you will have a much
easier time navigating the maze of programs available to you,
and understanding what obligations are, or are not, with each
type of program.
Let's start with some basic definitions.
PUBLIC DOMAIN has a very specific legal meaning. It
means that the creator of a work (in this case, a piece of
software) who had legal ownership of that work, has given up
ownership and dedicated the work "to the public domain".
Once something is in the public domain, anyone can use it in
any way they choose, and the author has no control over the
use and cannot demand payment for it.
If you find a program which the author has explicitly
put into the public domain you are free to use it however you
see fit, without paying for the right to use it. But use
care - due to the confusion over the meaning of the words,
programs are often described by others as being "public
domain" when in fact they are shareware or free, copyrighted
software. To be sure that a program is public domain you
should look for an explicit statement from the author to that
effect.
COPYRIGHTED is the opposite of public domain. A
copyrighted program is one where the author has asserted his
or her legal right to control the program's use and
distribution by placing the legally required copyright
notices in the program and documentation. The law gives
copyright owners broad rights to restrict how their work is
distributed, and provides for penalties for those who violate
these restrictions.
When you find a program that is copyrighted you must use
it in accordance with the copyright owner's restrictions on
distribution and payment. Usually these are clearly stated
in the program documentation.
Maintaining a copyright does not necessarily imply
charging a fee, so it is perfectly possible and legal to have
copyrighted programs which are distributed free of charge.
Such programs are sometimes termed "freeware", though this
term was in fact trademarked by the late Andrew Flugelman and
the legality of its use by others could be questioned. In
any case, the fact that a program is free does not mean that
it is in the public domain - though this is a common
confusion.
SHAREWARE is copyrighted software which is distributed
by authors through bulletin boards, on-line services, disk
vendors, and copies passed among friends. It is commercial
software which you are allowed to try out before you pay for
it.
- 6 -
HOME OFFICE TAX 1990
Shareware authors use a variety of licensing
restrictions on their copyrighted works, but most authors who
support their software require you to pay a "registration
fee" - the purchase price of the software - if you continue
to use the product after a trial period. Some authors
indicate a specific trial period after which you must pay
this fee; others leave the time period open and rely on you
to judge when you have decided to use the program, and
therefore should pay for it. Occasionally a shareware author
requires registration but does not require payment - this is
so called "$0 Shareware".
The shareware system and the continued availability of
quality shareware products depends on your willingness to
register and pay for the shareware you use. The registration
fees you pay allow authors to support and continue to develop
their products.
As a software user you benefit from this system because
you get to try the software and determine whether it meets
your needs before you pay for it. Authors also benefit
because we are able to get our products into your hands with
little or no expense for advertising and promotion. As a
result it is not unusual to find shareware products which
rival retail software that costs several times the amount of
the shareware registration fee.
ASP members' shareware meets additional quality
standards beyond ordinary shareware. Our members' programs
must be fully functional (not crippled, demonstration, or out
of date versions); program documentation must be complete and
must clearly state the registration fee and the benefits
received when registering; members provide free mail or
telephone support for a minimum of three months after
registration; and members must meet other guidelines which
help to insure that you as a user receive good value for your
money and are dealt with professionally. We also provide an
Ombudsman program to assist in resolving disputes between
authors and users. For more information on the ASP or to
contact the ASP Ombudsman, write to ASP, P.O. Box 5786,
Bellevue, WA 98006. You can also contact the Ombudsman on
CompuServe via an EasyPlex (electronic mail) message to
70007,3536.
HOME OFFICE TAX was created and is supported by the
organization listed on the front page. Users are encouraged
to report any problems and/or bugs by mail, phone, or thru
CompuServe (ID# 76407,607). Our address and phone number is
listed on the front page. We will do our best to respond to
your questions and problems within 48 hours of receipt.
╔═══════════════════════════════════════════════════════════╗
║ The registration fee for HOME OFFICE TAX is $18.00 ║
╚═══════════════════════════════════════════════════════════╝
Please use the registration form at the end of this
manual.
- 7 -
HOME OFFICE TAX 1990
ASP OMBUDSMAN
This program is produced by a member of the Association
of Shareware Professionals (ASP). ASP wants to make sure
that the shareware principle works for you. If you are
unable to resolve a shareware-related problem with an ASP
member by contacting the member directly, ASP may be able to
help. The ASP Ombudsman can help you resolve a dispute or
problem with an ASP member, but does not provide technical
support for members' products. Please write to the ASP
Ombudsman at P.O. Box 5786, Bellevue, WA 98006 or send a
CompuServe message via EasyPlex to ASP Ombudsman 70007,3536.
- 8 -
HOME OFFICE TAX 1990
BENEFITS TO REGISTERED USERS
The following will be provided to registered users of
HOME OFFICE TAX:
- Upon receipt of your registration we will send you the
latest version of HOME OFFICE TAX on disk along with your
own serial number, mailed notification of HOME OFFICE TAX
updates, and priority when calling us for support.
- Free update for the next year with the exception of a $5
postage and handling fee.
- Free support for one year.
- Free subscription to the ParyTech Update newsletter. This
newsletter brings you information and developments within
the field of home office tax deductions and other subjects
of interest.
- An additional disk with the latest shareware version of
HOME OFFICE TAX. You are encouraged to share this disk
with your friends and associates, give them copies, and
upload copies to your favorite BBS. The shareware version
carries with it the restrictions mentioned previously.
- A free CompuServe IntroPak, which includes a $15.00 usage
credit, is available to HOME OFFICE TAX registered users
who do not yet subscribe to CompuServe. CompuServe will
open the door for a whole new world of information,
services, and interesting people. CompuServe is also the
best place to obtain technical support for products from
ParyTech Associates and from other vendors and developers.
This CompuServe IntroPak (a $39.95 value) is provided to
HOME OFFICE TAX registered users compliments of CompuServe
Inc. and ParyTech Associates.
An additional disk containing the following:
- An evaluation copy of TAPCIS from Support Group Inc.
TAPCIS stands for The Access Program for CompuServe
Information Service. TAPCIS is a tool that makes using
CompuServe easier and more efficient. TAPCIS will save you
hours of on-line time and make using CompuServe fun.
TAPCIS is a shareware program and is provided for
evaluation only. If you continue to use TAPCIS after the
evaluation period you must register with Support Group Inc.
TAPCIS registration includes toll free technical support by
calling 1-800-USA-GROUP, and a two layer money back
guarantee. First, since TAPCIS is shareware, you may use
it during the evaluation period without committing a penny.
Second, when you register you also get a full 90 day money
back guarantee. This is undoubtedly one of the best money
back guarantees in the industry! TAPCIS registration is
only $79.00.
These additional programs and offers are made available
solely as a service to HOME OFFICE TAX registered users.
ParyTech Associates receives no payments for distributing any
of these products, even when you register them with the
- 9 -
HOME OFFICE TAX 1990
author. This is simply another means for ParyTech Associates
to support its registered users and to help you get the most
out of your computer systems.
- 10 -
HOME OFFICE TAX 1990
SYSTEM REQUIREMENTS
- IBM PC, XT, AT, PS/2, or compatible with DOS 2.11 or
higher.
- 384K memory
- 2 360K floppy drives, 1 720K floppy drive, or a hard drive.
- Graphics Adaptors: Hercules, CGA, EGA, or VGA
- If you have a Hercules graphics adaptor, execute the file
HOT90H.BAT to run the program.
- Printer: IBM Graphics compatible is known to work,
although no special printer control codes are
used so it should work with almost any printer
that accepts standard printer commands. Let us
know if yours won't work.
- 11 -
HOME OFFICE TAX 1990
INSTALLATION
Copy all the files to a directory named HOT90 on your
working disk or hard drive. We recommend that you make a
sub-directory for your data files (e.g. Drive:\HOT90\FILES\).
Be sure to define that directory in the Configure System
selection from the Main Menu. The sample file demonstrates
the use of the program.
All data files have the file extension ".HOT"
╔═══════════════════════════════════════════════════════════╗
║ To execute the program, type HOT90 at the DOS prompt ║
║ and press ENTER. ║
╚═══════════════════════════════════════════════════════════╝
- 12 -
HOME OFFICE TAX 1990
COMMAND CONVENTIONS
A 'MENU' is when the computer presents you with a list
of selections to choose from. A 'WINDOW' is a box with
information inside of it (instructions or a menu). Often
windows will pop up on top of each other. The purpose of this
is to give you a visual idea of what is being presented to
you at the moment, and so that you can see parts of the
previous windows to give you an idea of where you've been
within the program.
SPECIAL KEY COMBINATIONS
Whenever you see the reference to a key sequence such as
"press Shift-Tab", that means that you should press and hold
the shift key and then press the Tab key, and then release
them both - much like typing a capital letter on a
typewriter.
MAKING A SELECTION
When you are presented with a menu or window, press the
number key for a selection, or any other special key
indicated, or move the highlight bar to the selection you
wish to make and press ENTER.
In other screens where you are presented with data entry
fields you can move through them with the following keys:
Press This To Do This
Tab
ENTER To move to the next field
Down Arrow
Shift-Tab To move to the previous field
Up Arrow
╔═══════════════════════════════════════════════════════════╗
║ HELP SYSTEM ║
║ ║
║ Throughout the program HELP is just one keystroke ║
║ away for whatever you are doing. The HELP SYSTEM ║
║ is intended to guide you when you have a question ║
║ about doing something in the program. Help is ║
║ available whenever the message "F1 Help" is shown ║
║ at the bottom left of the screen. ║
║ ║
║ To Get HELP, press F1 ║
╚═══════════════════════════════════════════════════════════╝
- 13 -
HOME OFFICE TAX 1990
GETTING OUT OF AN AREA (ESCape!)
If at any point in the program you find yourself in
something that you don't want to be, or you are uncertain of
what you are supposed to be doing, you can back up to
previous steps by continually pressing the ESC key until you
are at a point where you feel you have control. This will
eventually take you back to the Main Menu, and ultimately end
the program if you choose to.
- 14 -
HOME OFFICE TAX 1990
INFORMATION NEEDED
The following is a list of all the information you will
need to enter in this program. You will need to be able to
document this information (in the event of an audit). Make
sure you have receipts, statements, or cancelled checks !
YOUR NAME
Your first, middle initial, and last name.
SOCIAL SECURITY NUMBER
Your social security number.
TOTAL SQUARE FOOTAGE OF HOME
This is the total area of your home. You can measure it
a couple of ways. You can measure every room in the house
and compute the square footage of each room, then add all the
square footages to get a total for your home. Or the easy
way, take the outer dimensions of your home (e.g. 20 ft wide
by 40 ft long = 800 square ft. If you have a two level home,
multiple the 800 by 2).
SQUARE FOOTAGE OF OFFICE SPACE
Measure your office space to get a square footage.
If your space is not used exclusively for business (such as
providing daycare), you will need the average hours per week
and the number of weeks in the year that your home was used
for providing this service. Your square footage of office
space would also be the total area that is used in providing
this service. This applies only to those types of services
where exclusive use is not possible. Generally this applies
only to daycare services. Any other type of business
activity must use their office space exclusively for
business. If you have any question about how this applies to
your business, contact us or your local IRS office.
AVERAGE HOURS PER WEEK YOU PROVIDED DAY CARE
If you provided daycare you will need to figure out the
average hours each week that you provided day care.
NUMBER OF WEEKS YOU PROVIDED DAY CARE
If you provided daycare you will need to figure out how
many weeks in the year you provided daycare.
- 15 -
HOME OFFICE TAX 1990
TAKE DEPRECIATION DEDUCTION ON HOME?
If you do not want to take a depreciation deduction on
your home, to avoid capital gains in the future, answer 'N'
to this. If you plan to keep your home for the long term,
then it may be to your advantage to take a depreciation
deduction.
HOME IN-SERVICE DATE
This is the date that is considered the 'In-Service'
date for depreciation purposes. It has been difficult to get
a straight answer from the IRS on this subject. In the Tax
Reform Act of 1986 (that was supposed to simplify taxes?!),
Congress instituted some 'anti churning' rules. Anti
churning rules are intended to prevent taxpayers from
receiving a tax benefit on a piece of property twice. The
following is the best answer we have been able to obtain from
the IRS:
Home Purchased Bus. Started In-Ser. Date is Method
before 1981 before 1981 date home purch'd ADR/
CLAS
before 1981 after 1980 and date home used for ACRS
before 1987 business.
before 1981 after 1987 date home used for MACRS
business.
after 1980 and after 1980 and date home purch'd ACRS
before 1987 before 1987
after 1980 and after 1987 date home used for MACRS
before 1987 business.
after 1987 after 1987 date home used for MACRS
business.
If you have difficulty in determining which date to use
for your 'In-Service' date, then we recommend that you
consult with a tax expert. In the limits of this manual we
are not able to address all the tax possibilities. If you do
not follow the above guidelines then you must be warned that
in the event of an audit of this subject your tax may be
adjusted to reflect the correct depreciation for what the
auditor determines to be the correct in-service date.
STRAIGHTLINE DEPRECIATION
If you have deducted depreciation on your home office in
previous years, you will need to know if you elected
straight line depreciation.
- 16 -
HOME OFFICE TAX 1990
STRAIGHTLINE YEARS (if ACRS property)
If the date that you bought your home is between Jan 1,
1981 and Dec 31, 1986 (inclusive) then your home is ACRS
property for depreciation purposes. If you elected
straightline depreciation in the past, you will need to know
the number of years that you elected to use; 15, 18, 19, 35,
or 45 years.
COST/BASIS OF HOME
This is the cost of your home (your purchase price) or
your basis in your home (purchase price plus cost of
improvements). Cost or Basis is NOT based on market values.
It is based on what you paid.
DO NOT INCLUDE THE COST OF LAND. The cost of your land
should be stated on your purchase agreement or closing
papers. If not, check with your county assessor to find the
land value. Subtract the land value from your total purchase
price or basis.
MORTGAGE INTEREST PAID
This is the amount of interest you paid on your home
mortgage. Usually your mortgage company will send you a
statement at the end of the year stating this amount.
PROPERTY TAX PAID
This is the amount of property tax that was paid for the
year. This will usually be stated on the same statement as
your interest paid from your mortgage company, or you may get
this information from your local government agency (county
assessor), or your property tax statement.
RENT
If you do not own a home you can enter the amount of
rent you paid for the year. Do not enter any information
for; Date House Purchased, Mortgage Interest Paid, Property
Tax Paid, Cost/Basis of Home.
HOUSE INSURANCE PAID
This is the amount of property insurance premiums on
your home that you paid for the year. This may also be
stated on your statement from your mortgage company, on your
insurance policy, or in your check register.
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HOME OFFICE TAX 1990
GAS UTILITIES PAID
This is the amount of your heating bills paid for the
year. This could be natural gas, LP, oil, or cords of wood.
Hopefully, you've saved your bills from the year or can track
the checks paid in your check register. Or, you may be able
to get the amount from your utility company.
ELECTRIC UTILITIES PAID
This is the amount of your electric bills paid for the
year. As with the Gas Utilities, hopefully you have your
bills or can get the information from your utility company.
OTHER UTILITIES
This is the amount of other types of utilities that you
paid for the year such as; rubbish removal, sewer, water,
association fees (in condos or trailer parks), etc.
INDIRECT MAINTENANCE COSTS
This is the amount of maintenance costs you paid for the
year to maintain your home such as; exterior painting,
plumbing and heating maintenance and repairs, etc.
Painting or repair of rooms other than the home office
are not deductible. Any expenses directly related to the
home office are deductible directly as business expenses.
BUSINESS EXPENSES
This is the total amount of your business expenses
EXCLUDING Cost Of Sales (if you sell a product). All the
costs incurred in conducting your business, less the cost of
your products.
BUSINESS GROSS PROFIT
This is the amount of your business income AFTER
subtracting your Cost Of Sales (if you sell a product).
CASUALTY LOSSES
This is the amount of casualty losses you incur on your
home such as; fire damage, storm damage, vandalism, running
the car thru the garage, etc.
As per Code Sect 165 where a loss is sustained with
respect to property used partly for business purposes
(including profit making activities), the $100 and 10%
limitations apply only to that portion of the loss property
attributable to non-business use. See the following example.
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HOME OFFICE TAX 1990
Example:
Your home office percentage is 15%. Your have storm
damage to your home of $10,000. You will be able to
deduct $1500.
This is of course calculated for you by the program.
What you need to enter is the gross amount of loss after
subtracting actual or expected insurance reimbursements.
NOTE:
When calculating your casualty loss on your schedule A,
you need to apply the limitations to the balance of the
loss ($8,500 as in the above example, $10,000 -$1,500 =
$8,500). The $100 and 10% limitation would apply to the
$8,500 when you enter it on your schedule A.
INDIRECT EXPENSE CARRY FORWARD FROM 1989
This is the amount of any indirect expenses that you
could not deduct on your 1989 return, if any.
DEPRECIATION CARRY FORWARD FROM 1989
This is the amount of any depreciation that you could
not deduct on your 1989 return, if any.
SCHEDULE C, OR FORM 2106 FILER
You will need to determine if you are a Schedule C or
Form 2106 filer on your tax return. If you are self employed
you are a Schedule C filer. If you are an outside person for
a company and are required to maintain a home office, you are
a Form 2106 filer.
If you are a Form 2106 filer you must deduct your Home
Office tax deduction on your schedule A as a miscellaneous
itemized deduction which is subject to a 2% exclusion of your
adjusted gross income. You can not take the deduction on
your Form 2106. This may seem unfair, but it's the law.
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HOME OFFICE TAX 1990
MAIN MENU
When the program starts you are presented with the main
menu which gives you several selections.
1. Print Input Form
This allows you to print out a form for gathering the
various items of information you will need for entering
in item 2 above (Data Entry).
2. Data Entry
This takes you to a screen where you can enter
information in regards to your name, SSN, home, and
office space. To move around the input screen you can
press the following keys:
PRESS THIS TO DO THIS
ENTER To move to the next input
Down Arrow field.
Tab
Shift-Tab To move to the previous input
Up Arrow field.
To get Help, press F1. To exit the input screen, press
ESC. When exiting you'll be asked if you want to save
the input.
3. Print Reports
This takes you to another menu where you can select to
print the home office deduction worksheet, instructions,
and schedule to be attached to your tax form, based on
the information you have entered.
1 - Worksheet
This selection will print just the worksheet.
2 - Filing Instructions
This selection will print just the Filing
Instructions.
3 - Data Entered
This selection will print just the form that
contains all the data that you entered in the Data
Entry screen.
4 - Tax Return Statement
This selection will print just the statement that
is to be attached to your income tax return.
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HOME OFFICE TAX 1990
5 - Print all reports
This selection will print all the reports listed in
the previous selections.
ESC - Main Menu
This selection will take you back to the Main Menu.
Whenever you make any of the above selections you will
be presented with another small window asking you to prepare
your printer. When your printer is ready, press any key to
start printing. If you decide that you don't want to print
at this time, you can press ESC to return to the Reports
Menu. Once printing begins you can cancel the printing by
pressing ESC.
4. Configure System
This allows you to set options so that the program will
run correctly on your computer. You can select color or
monochrome monitors, snow suppression, file paths, and a
printer pause.
Screen Colors
If you have a color monitor you can have the
program display in color by electing color.
Snow Suppression
If you have an older Color Graphics Adaptor (CGA)
you can elect to have the screen writing slowed to
avoid the appearance of snow or flickering on your
monitor.
File Path
This is the path through which the program will
look to find your data files. We strongly suggest
that you create a subdirectory under the directory
in which you keep the program files. This
facilitates file maintenance. If you do not define
a file path the program will store and look for
files in the same directory that the program files
are in.
Printer Page Pause
If you do not have continuous feed paper or a sheet
feeder in your printer you can elect to have
printing paused after each page is printed.
Printer Ports
If you use a different printer port other than
LPT1, such as LPT2 or LPT3, you can elect the port
you want to the program to print through.
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HOME OFFICE TAX 1990
Return to Main Menu
By pressing ESC you can exit the configuration menu
and return to the Main Menu.
5. OS Shell
This allows you to shell out of the program and execute
DOS commands, or execute other programs. This leaves
the program suspended while you perform other functions.
When you are ready to return to the program, enter EXIT
at the DOS prompt.
This shell will operate correctly as long as you do not
run another program that requires more memory than is
available with the HOME OFFICE TAX Program loaded.
ESC Exit to DOS
This selection will ask you to confirm that you want to
exit the program and return to the operating system. If
you answer anything other than "Y", you will be returned
to the Main Menu.
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HOME OFFICE TAX 1990
GETTING A FILE
At various times in the program you may be asked for a
file name to work on. A file name is the name of a file in
which you want to save information for re-use later. The
name has a limit of 8 characters. You do not need to specify
any file extension names. If you do specify a file extension
it will be changed to ".HOT". The file name does not have to
be 8 characters long. It can be as short a 1 character.
Because of this limitation (max 8 characters) we are
sometimes forced to be creative in giving our file a name by
using abbreviations and acronyms.
TO GET A FILE: When you are presented with a window asking
for a file name, type in the file name you want to work on
and press ENTER. If you don't recall the file name, you can
press F2 to get a list of files that presently exist. When
you press F2 to see a list of files, another window will pop
up listing the files. The window that lists the files will
display up to 10 files at a time. You can scroll through
this window with the PAGE UP and PAGE DOWN keys. To select a
file, type in the name of the file in the window asking for a
file name. If at any time during this process you decide you
do not want to perform this function, just press ESCape
(several times if necessary) until you get back to where you
want to be in the program. Remember, HELP is available by
pressing F1.
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HOME OFFICE TAX 1990
DEPRECIATION CONVENTIONS USED
CALCULATION METHODS
Being that this is a computer generated depreciation
system, the best depreciation calculation is done by use of
percentage depreciation tables. These may vary by a few
pennies from other types of calculations, but are accurate
enough for tax purposes.
Any transitional property (placed in service between Jul
1, 1986 and Dec 31, 1986 electing MACRS) was not provided for
because it applies to property in progress of being
constructed, and I don't think very many people in the home
office position would gain anything by it. You probably
didn't even know about it anyway.
PERIODS USED
The periods used are the periods defined by law based on
the date you placed your home office in use. Exceptions are
where you have elected straightline depreciation and elected
different periods.
CONVENTIONS USED
The conventions used are those defined by law based on
the date you placed your home office in use. The present
conventions used are:
CLS Class Life System. Generally a straightline
depreciation over 40 years.
ADR Asset Depreciation Range. No real change from
the CLS convention for real estate.
ACRS Accelerated Cost Recovery System. Enacted by
the Tax Reform Act of 1980. This system
incorporated several methods based on the
date your home office was placed in service,
and defined various periods.
MACRS Modified Accelerated Cost Recovery System.
Enacted by the Tax Reform Act of 1986. This
system simplified ACRS and extended the
periods of depreciation.
No depreciation is computed for those of you who rent
your home or apartment. Instead, you get to deduct a portion
of the rent you paid. The program will figure that for you
too.
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HOME OFFICE TAX 1990
EXPLANATION OF REPORTS
At the top of each page of the reports your name and social
security number is printed to identify each page as yours.
WORKSHEET
---- USAGE BASIS ----
AREA BASIS
Line 1: Area used for business.
This is the square footage of your office space
that you entered in the Data Entry screen.
Line 2: Total area of home.
This is the total square footage of your home that
you entered in the Data Entry screen.
Line 3: Percentage of home used for business.
This is the percentage of your home office space
based on area.
If a time usage basis is not used, the message
"TOTAL PERCENTAGE OF HOME USED FOR BUSINESS XX %"
will be printed next.
TIME USAGE BASIS
Line 4: Hours facility used.
This is the average number of hours your home was
used that you entered in the Data Entry Screen.
If you did not enter information on time usage,
this area on the worksheet will not appear.
Line 5: Total hours available.
This is the total hours available in the year which
is 24 hrs X 365 days, which equals 8,736 hours.
Line 6: Percentage of time used for business.
This is the percentage of the usage hours to total
hours available in the year.
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HOME OFFICE TAX 1990
Line 7: Percentage of home usage for business.
This is the percentage of your home usage for
business based on the space and hours used.
If the time usage basis is used, the message
"TOTAL PERCENTAGE OF HOME USED FOR BUSINESS XX %"
will be printed next.
---- EXPENSES ----
Line 8: Business percentage of otherwise deductible
expenses.
These are expenses are that are deductible on your
'schedule A' anyway. However, by taking these as a
home office deduction you may avoid exclusions on
some of these expenses. These expenses may be
deducted even if you have a loss.
These expenses are listed in two columns; TOTAL
EXPENSE, and BUSINESS PART. The business part is
the total expense multiplied by the PERCENTAGE OF
HOME USED FOR BUSINESS listed above.
When you enter these deductions on your schedule A,
you should list the amount of TOTAL EXPENSE minus
the BUSINESS PART. This is a favorite part for the
IRS to audit because people forget to subtract the
business part when they list the expense on
schedule A.
a) Mortgage Interest.
This is the amount of mortgage interest that
you entered in the Data Entry screen.
b) Property Taxes.
This is the amount of property tax that you
entered in the Data Entry screen.
c) Casualty Losses.
This is the amount of casualty losses that you
entered in the Data Entry screen.
d) Totals.
This is the total of each column.
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HOME OFFICE TAX 1990
Line 9: Business Expenses.
This is the amount of business expenses that you
entered in the Data Entry screen. This should be
the amount of all business expenses excluding any
costs of sales.
Line 10: Indirect Expenses for Business Use of Home.
These expenses are deductible only to the extent to
which you have a profit from your business and
after deducting the amount from line 8d.
a) Electric Utilities.
This is the amount of electric utilities that
you entered in the Data Entry screen.
b) Gas Utilities.
This is the amount of gas utilities that you
entered in the Data Entry screen.
c) Other Utilities.
This is the amount of other utilities that you
entered in the Data Entry screen.
d) Insurance.
This is the amount of home insurance that you
entered in the Data Entry screen.
e) Maintenance.
This is the amount of indirect maintenance
that you entered in the Data Entry screen.
f) Rent.
This is the amount of rent (if any) that you
entered in the Data Entry screen.
g) Carry Forward from 1989.
This is the amount of carry forward from 1989
that you entered in the Data Entry screen.
h) Totals
This is the total of the columns.
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HOME OFFICE TAX 1990
Line 11: Depreciation
This is the amount of depreciation calculated for
your property based on the Basis and in-service
date of your home that you entered in the Data
Entry screen. On the next line the convention used
will be stated.
This deduction is limited to the amount of profit
from your business after deducting the indirect
expenses above and the amount of line 8d. The
reason that depreciation is the last deductible
item is because it is considered a phantom expense.
It doesn't require a cash outlay in the year.
Generally, whether you have a home office or not,
you will have depreciation anyway, (or more
appropriately for most real estate, appreciation).
Carry Forward from 1989.
This is the amount of carry forward from 1989
that you entered in the Data Entry screen.
Total
This is the total of the depreciation for this
year plus any carry forward.
---- DEDUCTION LIMITATION ----
This area calculates the amount of your home office
deduction taking into account any limitations as explained as
above for indirect expenses and depreciation.
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HOME OFFICE TAX 1990
FILING INSTRUCTIONS (Page 2)
---- CARRY FORWARD'S TO 1991 ----
If you cannot deduct all your expenses for 1990, this
area will tell you what expenses are to be carried forward to
1991.
---- WHERE TO DEDUCT ----
This area will tell you where to correctly deduct you
various home office expenses on your tax returns to effect
the best tax savings.
DATA ENTERED for these reports (Page 3)
This page lists all the information that you entered in
the Data Entry screen. This is all the information upon
which all the calculations are performed to calculate your
home office tax deductions.
TAX RETURN STATEMENT (the last three pages that are printed)
This page should be attached to your income tax return
as per the instructions on page 2 (above).
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HOME OFFICE TAX 1990
HOME OFFICE TAX 1990 REGISTRATION FORM
Name: ______________________________________________________
Company: ___________________________________________________
Address: ___________________________________________________
City, State, Zip: __________________________________________
Country: ___________________________________________________
************************************************************
Computer Make and & Model: _________________________________
Disk (5-1/4 or 3-1/2): ___________
Do you have a Hercules Graphics Adaptor ?: _________________
Where did you obtain a copy of this program ?: _____________
____________________________________________________________
************************************************************
Quantity: ______ X $18 = _________
Less Quantity Discount (see page 5) ______ % - _________
Minnesota residents add 6% sales tax + _________
TOTAL = _________
Your comments, criticisms, and appraisals will be
appreciated.
┌───────────────────────┐
│ MAIL TO: │
│ │
│ ParyTech Associates │
│ 16559 Quincy St. NE │
│ Ham Lake, MN 55304 │
└───────────────────────┘
Phone (612) 434-4330
CompuServe PPN: 76407,607
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