Augusta Rule: Renting Your Home to Your Business
Named for Augusta, Georgia (where residents rent to Masters attendees), Section 280A(g) is one of the cleanest tax strategies for S-corp and LLC owners with a legitimate business use for their home. It's simple, defensible, and often skipped.
The rule
You can rent your personal residence to any party — including your own business — for up to 14 days per year without recognizing the rental income personally.
The business deducts the rent as an ordinary business expense. You (personally) don't report the income.
How to use it
Host legitimate business meetings, board meetings, annual planning retreats, or client dinners at your home.
Charge a fair-market rental rate for the space.
Document each meeting with an agenda, attendee list, and business purpose.
Have the business write you a check (or ACH) for the rent, matching a rental agreement.
Fair-market rate documentation
Get comparable rental quotes from local hotels, conference centers, or event venues for a similar space in Billings or your market.
Save the comps in your permanent tax file. This is the single most-audited element of the strategy.
Typical defensible daily rates for a home meeting space in Montana run $300–$1,500 depending on size and amenities.
What NOT to do
Do not exceed 14 days — day 15 makes ALL the income taxable.
Do not skip the documentation. An 'Augusta Rule deduction' with no supporting agenda and comps is the definition of an audit adjustment.
Do not use it for routine daily work at home — that's a home office question, not Augusta.
The tax math
12 meetings × $800/day = $9,600 business deduction, $9,600 tax-free personal income.
At a 32% combined federal + Montana marginal rate, that's roughly $3,000/year in real tax savings — for meetings you'd likely have anyway.
A quick disclaimer
This article is general information for Montana small business owners, not tax, legal, or accounting advice for your specific situation. Rules change, and how they apply depends on facts we don't know about you. Before acting on anything you read here, talk to a qualified professional. If you're a Montana business owner and want a real conversation about your books, payroll, or tax, that's what Marlow Accounting is here for — call 406-290-1214 or schedule a discovery call.