Your home may be considered your principal place of business based on the following factors:

• The relative importance of the activities performed at each location, including your home, where you conduct business.
• If the relative importance factor does not determine your principal place of business, you can also consider the time spent at each location, including your home, where you conduct business.

The IRS further states that your home office may also qualify as your principal place of business for deducting expenses for its business use if you meet the following requirements:

• You use it exclusively and regularly for administrative or management activities of your business.
• You have no other fixed location where you conduct substantial administrative or management activities of your business.

You can have more than one business location, including your home, for a single business. To qualify to deduct the expenses for the business use of your home under the principal place of business test, the substantial administration and management of that business must be conducted in your home. All the facts and circumstances must be considered to determine that your home qualifies as your principal place of business.

According to the IRS regulations, the following are a few examples of administrative or management activities:

• Billing customers, clients, or patients.
• Keeping books and records.
• Ordering supplies.
• Setting up appointments.
• Forwarding orders or writing reports.

Some administrative or management activities may be performed at other locations, and that will not disqualify your home office from being your principal place of business. Examples of activities that may be performed at other locations are:

• You hire someone else to conduct some administrative or management activities at locations other than your home. Many companies hire someone else to do their payroll, and this would not disqualify the home from being their principal place of business.
• You can conduct some administrative or management activities away from your home at places that are not fixed locations, such as in a car or a hotel room. This allows you to conduct business while you are traveling.
• You can occasionally conduct minimal administrative or management activities at a fixed location outside your home. This must be done infrequently.
• You conduct substantial nonadministrative or nonmanagement business activities at a fixed location outside your home. For example, some companies use a conference room outside their home to meet with or provide services to customers or clients at a fixed location outside their home, and that would not disqualify their home from being the principal place of business.