SYSOPERATIONALRETURNS / YEAR9,500+REFUNDS DELIVERED$8M+STRATEGIES DEPLOYED400+RETURNS TRAINED GENIE10,000+UPTIME 90D99.998%IRS ACK< 90sSOC 2 TYPE IIATTORNEY-CLIENT PRIVILEGESYSOPERATIONALRETURNS / YEAR9,500+REFUNDS DELIVERED$8M+STRATEGIES DEPLOYED400+RETURNS TRAINED GENIE10,000+UPTIME 90D99.998%IRS ACK< 90sSOC 2 TYPE IIATTORNEY-CLIENT PRIVILEGE
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TAX STRATEGY

The Augusta Rule: Rent Your Home to Your Business Tax-Free

IRC §280A(g) lets you rent your home to your business for up to 14 days per year. The business deducts it. You pay zero income tax on the rent.

Business Strategy◷ 5 min readApril 2026intermediateTaxosAgent Editorial Team
Savings Potential
$5,000–$14,000 annually
Results vary by situation
Eligible:S-CorpLLCC-Corp

Think of it as a gift from the IRS.

Think of the Augusta Rule as a gift from the IRS to business owners who work from home. It’s §280A(g) in the code, and here is how it puts money back in your pocket. Named after the legendary Masters Tournament in Augusta, Georgia, this specific rule allows homeowners to rent out their primary residence for up to 14 days per year without having to report the rental income on their personal tax return.

For business owners, this creates a powerful synergy: your business (S-Corp or LLC) pays you rent for legitimate business meetings or events held at your home. The business gets a tax deduction, and you receive the income tax-free.

The $14,000 Deduction Example

Example — $14,000 Deduction

Monthly board meetings at your home instead of a hotel conference room.

  • Market rate for local meeting space: $1,000/day
  • Annual usage: 14 days
  • Business deduction: $14,000 (IRC §280A(g))
  • Personal taxable income: $0

At a 37% bracket, this saves approximately $5,180 in cash. The rent must be “reasonable” for your local market and the type of property.

How it Works for S-Corps and LLCs

Whether you are an S-Corp or a Multi-Member LLC, the mechanics are simple and expert-approved:

  • The business must have a legitimate reason to rent the space (board meetings, strategic planning, employee training).
  • The home must be owned by the individual, not the business.
  • The rental period cannot exceed 14 days in a single calendar year.
  • A formal rental agreement should be in place between you and your entity.

Implementation Steps

  1. Market Research: Document the cost of comparable meeting spaces (hotels, coworking conference rooms) nearby.
  2. Board Minutes: Formally document the business purpose of the meeting in your company minutes.
  3. Rental Agreement: Sign a short-term lease agreement between yourself and your corporation.
  4. Payment: Issue a business check or transfer to your personal account for the rent.
  5. Invoicing: Create an invoice from yourself to the business for each meeting date.

Audit Protection

Critical Compliance

Do not simply transfer money and call it rent. Without documentation (board minutes, invoices, market comparables), the IRS will likely disallow the deduction and reclassify it as a taxable distribution.

Ready to implement the Augusta Rule?

TaxosAgent generates your rental agreements and board minutes automatically.

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Consult a licensed professional before implementing any tax strategy. Individual results vary.

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