Calculating the Home Office Deduction
March 1, 2004
If your home office meets Internal Revenue Service (www.irs.gov) criteria, you can take a tax deduction for operating costs associated with it. Your deduction is based on the percentage of your home the office occupies, so if your home is 2,000 square feet and your office is 200 square feet, you can deduct 10 percent of your costs. To calculate the deduction, you’ll need the following information:
- Square footage of your home
- Square footage of your home office
- Mortgage interest reported on Form 1098
- Homeowners insurance premium
- Invoices for maintenance or repair on your home
- Total rent paid, if applicable
- Property tax payment
- Utility bills
Source:TurboTax (www.turbotax.com). Reprinted with permission from Intuit Inc., Tucson, Ariz.
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