> As for the room you code in. That is very hard to do. At one point I tried to 
> do a
> percentage of the mortgage, the electric bill, and a few other things. But my 
> CPA said,
> lets not do that.

I have a very good friend whose entire working life has been spent
contracting, he's always been self employed, does his own books, etc.
He had three pieces of advice for me when I went into business for
myself:

1) Don't ( I ignored this, it turned out ok)

2) Failing that, *DO NOT* try to figure out how much
rent/mortgage/utilities you're "subletting" to yourself in your house;
the miniscule amount it will mean on your taxes (there is NOT a direct
dollar spent to dollar off taxes corellation) will be dwarfed even
further by the massive penalties imposed by the IRS should they
determine that you fudged, winked or outright lied.

Proving that you use 100 sq.ft. and 6 hrs/day of space/utilities to
the satisfaction of the IRS may seem like a dawdle, but it'll feel
much worse when they scope your a$$ looking to jack you up (and no
matter what the IRS says, the tax code DOES NOT favor the small
business). -- took this advice and it was confirmed by the CPA I hired
the next year.

3) Get a CPA (did this too after getting roto-rootered at tax time the
first year - not audited, but so freaked out an had to pay so much,
even after figuring/paying quarterly payments)

-- 
will

"If my life weren't funny, it would just be true;
and that would just be unacceptable."
- Carrie Fisher

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