Frost & Associates, LLC
Call Today 202-618-1873

Taxes for 1099 workers, part 2: the home-office deduction

In the first part of this post, we noted what a hassle it can be to take care of taxes as a freelance worker. Figuring out self-employment tax can be complicated - and it's easy to fall behind on making the estimated tax payments you're supposed to make quarterly.

If you have a home office, another thing you have to figure out is whether to take the home office deduction. Should you take it and how does it work?

Knowing the answers to these questions is important because if you claim the home-office deduction when you shouldn't, it can increase the chances of a tax audit.

Three years ago, in tax year 2013, the IRS adopted a simplified method for claiming the home-office deduction. (Tax year 2013 refers to returns filed in 2014.)

The simplified option did not change the eligibility criteria for the deduction. To take the deduction, you must use a portion of your residence exclusively for business purposes and do so on a regular basis.

There are a couple of exceptions to the requirement that the space be used exclusively for business. One is for home daycare operators and the other for people who use a space in their residence to store product inventory or samples.

Generally, however, the space set aside for the office has to be used exclusively for work in order to claim the home-office deduction.

The simplified calculation for the deduction is based on allowing the deduction of $5 per square foot of a residence used for business purposes. The regular method involves calculating actual expenses for the percentage of the home that is used for business.

This means that you actually have two choices regarding the home-office deduction. One is whether to take it. The other is which method to use to calculate it.

No Comments

Leave a comment
Comment Information
Every Tax Problem Has A Solution

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Contact us today!

Frost & Associates, Attorneys at Law
1629 K Street NW, Suite 300
Washington, D.C. 20006

Phone: 202-618-1873
Phone: 202-618-1873
Fax: 888-235-8405
Washington Law Office Map

Columbia Office
10440 Little Patuxent Parkway, Suite 300
Columbia, MD 21044

Phone: 202-618-1873
Phone: 202-618-1873
Fax: 888-235-8405
Columbia Law Office Map

Annapolis Office
888 Bestgate Road
Suite 400
Annapolis, MD 21401

Phone: 202-618-1873
Phone: 202-618-1873
Fax: 888-235-8405
Map & Directions

Fairfax Office
8280 Willow Oaks Corporate Drive
Suite 600
Fairfax, VA 22031

Phone: 202-618-1873
Phone: 703-621-7169
Fax: 888-235-8405
Map & Directions

Rockville Office
199 E. Montgomery Avenue
Suite 100
Rockville, MD 20850

Phone: 202-618-1873
Phone: 240-599-5009
Fax: 888-235-8405
Map & Directions

Find us on...
  • Facebook
  • Twitter
  • Linked In