Home Office Deduction 2019 Simplified Method

If you have a very small home business space under 300 square feet the simplified deduction might be best. For instance you might choose the actual expense method on your 2018 return use the simplified method when you file your 2019 return next year and then switch back to the actual expense method thereafter. When claiming the home office deduction you re not locked into a particular method.

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Taking the simplified home office deduction doesn t change the fact that you still need to qualify for the home office deduction under the standard rules.

Home office deduction 2019 simplified method. So if you use a whole room or part of a room for conducting your business you need to figure out the percentage of your home devoted to your business activities. What is the simplified method for determining the home office deduction. The maximum square footage you can take the deduction for is 300 square feet. When claiming the home office deduction you re not locked into a particular method.

The choice is yours. There are two ways to calculate your home office deduction. If your business space is large or if you have many expenses related to your home business space for the year but only to that space you might get a larger deduction with the normal method. The simplified method as announced in revenue procedure 2013 13 is an easier way than the method provided in the internal revenue code the standard method to determine the amount of expenses you can deduct for a qualified business use of a home.

The simplified home office deduction can be claimed starting in tax year 2013. You need to make sure you meet one or more of these requirements. There are additional rules regarding depreciation and carryover losses. You use your home office as your primary place of business.

Follow along as we walk you through the basics of the home office tax deduction and help you figure out which method works best for your home business. For instance you might choose the actual expense method on your 2018 return use the simplified method when you file your 2019 return next year and then switch back to the actual expense method thereafter. However the deduction is capped at 1 500 per year. Requirements to claim the home office deduction.

Why is the simplified method being offere. Generally when using the regular method deductions for a home office are based on the percentage of your home devoted to business use. So it can only be used for offices up to 300 square feet. Since 2013 the irs has even offered a simplified method in addition to the regular business percentage method to determine the home office deduction.

Allowable square footage of home use for business not to exceed 300 square feet. Deduction for home office use of a portion of a residence allowed only if that portion is exclusively used on a regular basis for business purposes. Using the optional method you simply deduct 5 for every square foot of your home office. 1 the simplified method says you can deduct 5 per square foot.

How much can i claim for my home office deduction.