Do you have space in your home that you use strictly for business? That area may qualify as a home office space that will allow you to take deductions on your tax return for expenses related to the business use of your home, Form 8829. Once you have determined if your business space in your home qualifies, you are able to take deductions for a portion of expenses such as:
- Depreciation
- Mortgage interest
- Real estate taxes
- Rent (with the exception of rent paid by the employer for the area in question)
- Utility costs
- Cleaning and other services
- Homeowner’s insurance
- Security system costs
- Repair costs (labor and supplies)
There is also a simplified method that allows you deduction of $5 per square foot of the home office up to $1500. By using this method, you do not have to track the above listed expenses making it easier to save tax dollars!