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Simplified Home Office Deduction (ASL) - YouTube video text script

Hi, I’m Patti, and I work for the IRS.   

If you conduct business out of your home, deducting the use of a home office has never been easier due to some recent changes at the IRS.  

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 calculate their deduction by simply measuring the square footage of your office and multiplying that figure by a dollar amount prescribed by the IRS.  

The new optional deduction is capped at $1,500 a year.  

This is based on the prescribed rate of five dollars per square foot, times the square footage up to 300 square feet, which equals a maximum deduction of $1,500.

If you have traditionally depreciated the portion of your home used in your trade or business, it is important to know that this method does not allow for depreciation.

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 new optional deduction, check out our website at

Page Last Reviewed or Updated: 08-Sep-2015