IRS Regular Method Home Office Deduction

This article is about how to use the Regular Method home office deduction for self employed that work from home.

As someone who is self-employed you’re likely always on a search for ways to maximize your take-home income. This often means maximizing your tax deductions. Further, if you work from home you can deduct part of your rent or mortgage. The IRS regular method for the home office deduction is one way to do that. Read on to learn more.

What is the Home Office Deduction?

The home office tax deduction is a deduction that allows self-employed who work from home to deduct home office expenses. Home office expenses include rent (or mortgage), utilities, and other expenses related to the use of your home for work.

This article is about the Regular Home office deduction method for calculating your home office tax deduction amount.

Not familiar with the home office deduction?
Check out the following article for complete details about the home office deduction, such as how you qualify and other calculation methods available, Home Office Tax Deduction for Self Employed. Click in the tax in blue to open the article.

What is the Regular Method Home Office Deduction?

The regular method home office deduction is a method defined by the IRS for individual tax payers to use to calculate the amount of their home office tax deduction. This method involves calculating each home office expense individually. After, you add each individual expense amount together to get the total home office deduction amount. Home office expenses include:

  • rent or mortgage
  • mortgage interest
  • insurance
  • utilities
  • repairs
  • depreciation
  • any other expenses incurred during the use of your home office

How Do I Calculate My Home Office Tax Deduction Using the Regular Method?

To calculate the amount of each expense item you use the percentage space of your used for your home office. For example, if 20 percent of your home is dedicated to your home office and the total amount of your utilities expenses are $2000 dollars for the tax year; then the amount of your utilities portion of your home office expense would be calculated as follows:

$1000 x 0.20 = $400 Home Office Expense (i.e. Home Office Tax Deduction)

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