Another Tax Idea For Practice Owners – Introducing, The Augusta Rule!

Today we dive into a tax topic specifically tailored for private practitioners and business owners operating under S-Corps, C-Corps, or LLCs taxed as such. We explore the intriguing Augusta Rule, which derives its name from Augusta, Georgia. Historically, homeowners near Augusta National would rent out their houses during an annual tournament, generating rental income that the IRS sought to tax. The Augusta Rule is a unique provision in the tax code that allows for the tax-free rental of a personal dwelling for up to 14 days. Listen in to learn how to make the most of this rule and what to put in place if you have a business and wish to host events like dinners or board of directors meetings at your house. You’ll hear why it’s crucial to charge a market rate for rent, how to ensure your bookkeeper is aware of these arrangements and why you must strictly adhere to the 14-day limit.