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Simplified Home Office Deduction - YouTube video text script

HI… I’M JULIANNE… AND I WORK FOR THE INTERNAL REVENUE SERVICE.   

DEDUCTING THE USE OF A HOME OFFICE HAS NEVER BEEN EASIER DUE TO SOME RECENT CHANGES AT THE  I-R-S.  

STARTING WITH YOUR 2013 TAX RETURN… IF YOU ARE ELIGIBLE FOR A HOME OFFICE DEDUCTION…, YOU CAN CHOOSE A NEW SIMPLIFIED OPTION THAT CAN SAVE YOU A LOT OF TIME.  

THIS NEW OPTION REQUIRES LESS PAPERWORK AND RECORDKEEPING.

INSTEAD OF BASING THE HOME OFFICE DEDUCTION ON YOUR ACTUAL EXPENSES … THIS OPTION ALLOWS MOST TAXPAYERS TO…  SIMPLY MULTIPLY THE SQUARE FOOTAGE OF YOUR OFFICE BY A PRESCRIBED RATE.  

THE NEW OPTIONAL DEDUCTION IS CAPPED AT ONE-THOUSAND-500 DOLLARS A YEAR BASED ON FIVE DOLLARS PER SQUARE FOOT FOR UP TO 300 SQUARE FEET.  

IF YOU USE THIS METHOD… YOU CANNOT DEPRECIATE THE PORTION OF YOUR HOME USED IN YOUR TRADE OR BUSINESS.

BUT YOU CAN STILL DEDUCT… BUSINESS EXPENSES SUCH AS ADVERTISING…  SUPPLIES AND WAGES PAID TO EMPLOYEES.

AND IF YOU ITEMIZE, YOUR DEDUCTIBLE HOME RELATED EXPENSES SHOULD BE DEDUCTED IN FULL ON YOUR FORM 1040 SCHEDULE A.

OTHER RESTRICTIONS MAY APPLY.  

FOR MORE DETAILS ON THE DEDUCTION… CHECK OUT OUR WEBSITE AT I-R-S-DOT-GOV.      

NEW OPTIONAL DEDUCTION… CHECK OUT OUR WEBSITE AT I-R-S-DOT-GOV.

Page Last Reviewed or Updated: 05-Jun-2014