## Facts

- Katia V. Popov was a professional violinist who performed and recorded for numerous contractors at many different studios and venues.
- In 1993, she worked for about two dozen contractors and recorded in dozens of locations, with sessions requiring rapid sight-reading because sheet music was provided only upon arrival.
- No employer provided Popov a place to practice.
- Popov, her husband, and their child lived in a small one-bedroom apartment; the living room was set up with music and recording equipment and used as her work space.
- Popov used the living room exclusively and regularly for her music business, practicing about four to five hours per day and making practice and demonstration recordings; the family did not use the room for sleeping or play.
- The Popovs claimed a home-office deduction on their 1993 joint return, allocating a portion of rent and utilities to the living-room work area.
- The IRS disallowed the deduction on the ground that the living room was not Popov’s “principal place of business” under I.R.C. § 280A(c)(1)(A), and the Tax Court upheld the disallowance based largely on the view that income was earned at studios and concert halls.

## Issues

1. Whether a professional violinist’s home practice room, used exclusively and regularly, can qualify as the taxpayer’s “principal place of business” under I.R.C. § 280A(c)(1)(A) when performances and recordings occur at numerous off-site locations.

## Decision

- The Ninth Circuit reversed the Tax Court.
- The court held that, on these facts, the apartment living room was Popov’s principal place of business under § 280A(c)(1)(A).
- The court concluded the Popovs were entitled to the claimed home-office deduction.

## Legal Principles

- Under I.R.C. § 280A(c)(1)(A), home-office expenses are deductible only if a portion of the dwelling is used exclusively and regularly as the taxpayer’s principal place of business.
- The “principal place of business” inquiry applies the comparative framework from *Commissioner v. Soliman*, considering (1) the relative importance of the activities performed at each location and (2) the time spent at each location.
- For itinerant professionals working at many sites, essential preparatory work performed at home may be the principal business activity when it is necessary to perform the paid work and occupies the bulk of the taxpayer’s working time.
- A rigid rule treating only the service-delivery site as the principal place of business is inconsistent with the comparative, fact-specific analysis required by *Soliman*.

## Conclusion

Because Popov’s extensive daily practice at home was essential to her professional work, occurred for substantially more time than her scattered off-site performances and recordings, and was conducted in a space used exclusively and regularly for business, the home practice room qualified as her principal place of business and the associated home-office expenses were deductible.


Popov v. Comm’r, 246 F.3d 1190 (9th Cir. 2001)