Deducting Office Expense

Craig Thomas

Craig Thomas

Managing Partner, CPA, Certified Tax Resolution Specialist at Streamline Tax Resolution, llc
Craig Thomas

Latest posts by Craig Thomas (see all)


For many of those who work from home, the process of calculating home-office deductions can be confusing. That’s why, beginning last filing season, the IRS has offered a simplified alternative option to calculate home-office itemized deductions.

Under the old method, taxpayers labored to complete a very intricate and drawn-out IRS form. The majority of time was spent on allocating expenses between personal use, and business use, which could took all day if you were not organized. The percentage of your home devoted to business also had to be determined.

Under the new optional method, you can simply claim $5 per square foot of space, which meets the definition of a qualified home office, up to a maximum of 300 square feet. Therefore, the maximum amount that can be deducted using this method is $1,500.

Besides saving time, this simplified option can significantly reduce the burden of record-keeping by allowing a taxpayer to use a flat rate for the allowable square footage of the office, rather than determine actual expenses.

For the most part, you can continue to take the same allowable home-related deductions under the new method, but there are a couple of changes in the criteria for eligibility in taking certain deductions under the simplified method, such as depreciation.

The IRS table below shows the comparisons of the two methods:

Screenshot 2015-03-17 12.21.40

Whether or not the new simplified method works to your advantage, it’s good to see that the IRS has actually made something ‘easier’.

For more information on tax resolution services,visit:
Craig Thomas can be reached at: