A new article from U.S. News addresses rumors about who can claim the home office tax deduction. With the large number of American small businesses based out of an owner’s home – including more than half of all small businesses, according to the Small Business Administration – those who qualify shouldn’t hesitate to claim the home office deduction. But unlike more obvious deductions, many people aren’t sure if they qualify to take the home office deduction.
According to the IRS, a portion of your home might be considered a legitimate home office if it meets a few requirements: It’s your primary workplace (i.e., you don’t have a separate office space that you are required to attend from 9 to 5 every day); it’s used exclusively for work; you regularly meet with clients there; and/or you have a place such as a garage that you use to store work-related supplies.
Recognizing that calculating the percentage of a mortgage and other expenses by the square footage of a home office can be a trial, the IRS instituted in 2013 what it calls the “simplified option” for calculating the home office deduction in 2013.
