The Augusta Rule: Rent Your Home to Your Business, Tax-Free

Victor • September 22, 2025

If you’re a small business owner, there’s a not so well known tax break that can put extra money in your pocket while staying IRS compliant. It’s called the Augusta Rule (IRS Section 280A), and it allows you to rent out your home to your business for up to 14 days per year, and the income you receive is completely tax free.

How the Augusta Rule Works

The rule gets its nickname from Augusta, Georgia, where homeowners famously rent out their houses for the Masters golf tournament each year. But you don’t have to live near a golf course to use it. Any homeowner can apply this tax strategy!


Here’s how it works:

  • Your business rents your personal residence for legitimate business use, such as board meetings, planning retreats, or client events.
  • As long as the rental period doesn’t exceed 14 days in a calendar year, you don’t have to report that rental income on your personal tax return.
  • Meanwhile, your business can deduct the rental expense, reducing its taxable income.


It’s a win-win situation: the business saves on taxes, and you personally receive tax free income.

The Getty building with stairs and potted plants in front of it.

Rules to Keep in Mind

Like any tax break, the Augusta Rule has some considerations:

  • The rental rate must be in line with fair market value. Don’t overcharge your business.
  • Keep records of the meetings or events, including dates, agendas, and minutes. Documentation matters.
  • You can’t exceed 14 days per year, even one extra day makes the income taxable.

More information on the 14-day exclusion concept: CreditTopic no. 415, Renting residential and vacation property

Why Business Owners Should Care

Imagine you rent your home to your business for a monthly planning meeting at $500 per day. Over 12 months, that’s $6,000 of tax free income for you, while your business writes it off as a legitimate expense.



For small business owners, that’s a powerful way to move money out of the company and into your household.

Final Thoughts

The Augusta Rule is one of those tax strategies many entrepreneurs overlook because it sounds suspicious or risky. But it’s written directly into the tax code, and with proper documentation, it’s 100% legal.


At DRS Accounting PC, we help small business owners discover and use strategies like the Augusta Rule to reduce taxes and build wealth. If you’d like to know whether this works for your business, schedule a free consultation today.

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