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Can You Deduct Your Home Office from Your Taxes if you Work from Home?

The home office deduction has traditionally only been relevant to freelancers and contractors. However, with the majority of Americans working from home during the pandemic, many workers are tacking on additional expenses they wouldn’t normally have. On this list, are bills related to upgraded wifi, ergonomic furniture, and professional-grade routers. With all of these new expenses, many are wondering how the home office deduction will adjust. Unfortunately qualifying for the home office deduction is not as simple as working from a computer at your house.

If you are struggling to determine whether you are eligible for the home office deduction, it can be beneficial to seek help from a skilled tax professional. An experienced tax lawyer is a great resource for ensuring you claim all the deductions you are eligible for.

The Home Office Deduction

To qualify for a home office deduction, you need to have a “designated home office” that is solely used for business purposes on a regular basis.

Many people falsely think that in order to claim this deduction, they must have an entire room of their house reserved as an office space. However, this is not the case. In fact, all you need is a part of your home that you use for work, such as a desk and chair.

Another important qualifier of this deduction is that space must solely be used for business purposes. For example, if you are going to claim the home office deduction it means friends and family—who are not your employees or co-workers—can you use your office computer for leisurely purposes.

Lastly, your home office must be used on a regular basis, meaning you can’t have a gig here and there and claim this deduction. In order to be eligible, your home office space will need to be used on a weekly, monthly, or daily basis.

Traditionally, the home office deduction has been an essential tax break to freelancers and self-employed individuals, providing them with a great way to manage their finances. However, for many, the pandemic has posed the question: Can you deduct home office expenses not reimbursed by your employer from your taxes if you aren’t a freelancer? For now, no.

Are You Eligible for the Home Office Deduction for Expenses Not Reimbursed by Your Employer?

Although the pandemic has come with a host of new house expenses for many workers, unless you are self-employed, you can’t claim the home office deduction.

In 2017, Congress passed the Tax Cuts and Jobs Act, which essentially removed all deductions for unreimbursed employees and replaced it with a larger standard deduction. However, this doesn’t mean you should stop keeping records of all your work-related home expenses. Pandemic measures are constantly evolving, and it remains unclear if new laws will be set in place for the 2021 tax year to account for the increase in home expenses. Therefore, it’s best to keep detailed records and receipts of all your wifi bills, new furniture, and any other work-related home expenses.

Always Ask Your Employer if They Reimburse Work From Home Expenses

Before you give up on getting reimbursed for all your new expenses, it’s always best to check in with your employer and ask if they will cover any of them. As the workplace has changed due to the pandemic, it’s likely your employer may have updated their reimbursement policy. In fact, many employers have responded to the pandemic by helping their staff pay for home office equipment. Therefore, it’s always best to ask your company if they can reimburse any of your home office expenses.

Claim all Eligible Deductions with a Skilled Tax Resolution Attorney

Filing your taxes can be complicated. If you are struggling to figure out the deductions you are eligible for, it can be helpful to work with a skilled tax attorney. An experienced tax professional can look at all your tax documents, expense records, and receipts and ensure you claim any deductions you qualify for.

At Morgan Sebastian Law, Attorney Becky Sebastian is eager to help you navigate the complexities of your tax situation. We understand the challenges of navigating deductions and are here to help you properly handle your taxes. To schedule a consultation with an experienced tax resolution lawyer, call 877-938-1350 or fill out our online contact form.