You must use the space in your house exclusvely for the general business operations of your busness. Examples included a designated room, or space that others do not use. You could not desginate your dining room where you also feed your family, they play games, etc.
Principal Place of Business:
Your home must be your principal place of business. Meaning you should not have another office location. If you do have another office location then you should be doing the majority of work at your home office, further exploration is necessary in those situations. Either way you should be doing much of your business operations in your home for it to qualify. Including: documenting on patient's charts, invoicing clients, scheduling patients, printing exercise sheets etc.
Take a look at the IRS Page for further explanation: (http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Home-Office-Deduction)
Common tax deductible expenses for a home based business:
____ Mortgage interest, real property taxes, PMI insurance, HOA Fees, (http://www.taxpreparerplus.com/self_employed.html) ____ Utilities, such as natural gas, electric, propane ____ Trash service, pest control service ____ Home insurance ____ Regular maintenance of the home
____ Depreciation of the business part of the home
____ House Alarm Monitory Fees
____ House Cleaning
Take a look at the IRS Page for further explanation: IRS Form 587: http://www.irs.gov/publications/p587/index.html