Schedule C

20b — Rent or Lease -- Other Business Property Updated for tax year 2025

What this line means

Rent you paid for office space, retail space, warehouse, studio, workshop, or any other business property that is not a vehicle, machine, or piece of equipment. This includes monthly rent on a commercial lease, coworking space memberships, rented storage units for business inventory, and payments for shared office space. Do not include rent on your home — the home office deduction is a separate calculation on line 30.

Does this apply to you?

  • You rent office space, a retail storefront, or a commercial suite
  • You pay for a coworking space membership or hot desk
  • You rent a warehouse, storage unit, or workshop for business
  • You lease a studio, salon chair, or other shared professional space

Easy to overlook

Coworking space memberships are deductible Monthly payments to WeWork, Regus, or any coworking space where you conduct business are deductible on line 20b. Day passes count too. If you work from a coffee shop and occasionally use a coworking space, those coworking fees are deductible even though your primary workspace is elsewhere. 1 [SOURCE: General filing pattern — missed coworking and shared space deductions]

Storage units for business inventory or equipment If you rent a storage unit to hold business inventory, supplies, or equipment, that monthly rental is a deductible business expense here. Many sole proprietors — especially those who sell online — use storage units but forget to track the rental as a business expense. 2 [SOURCE: IRS Schedule C instructions — Line 20b]

Watch out for this

Deducting your home rent or mortgage payment on this line when you work from home. Your home is not “other business property” — the home office deduction (Form 8829 or simplified method) goes on line 30. Line 20b is for separate commercial spaces you rent in addition to your home.

  • Line 30 — Schedule C — Business use of home; home office deduction goes there
  • Line 20a — Schedule C — Rent on vehicles, machinery, and equipment
  • Line 16a — Schedule C — Mortgage interest; if you own the business property instead of renting

Footnotes

  1. IRS Schedule C (Form 1040) Instructions. See also IRS Publication 17, Your Federal Income Tax. https://www.irs.gov/pub/irs-pdf/p17.pdf ↩

  2. IRS Schedule C (Form 1040) Instructions, Line 20b. https://www.irs.gov/instructions/i1040sc ↩

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