Maximizing Home Office Deduction

Learning Objectives

• To apply simplified and actual expense methods of home office deduction calculations.
• To explain the requirements for and limitations of the home office deduction.
• To know how to maximize the tax benefits of the home office deduction for your clients.
• To ensure tax preparer due diligence in applying the home office deduction.

Course Description

In the wake of the post-pandemic world, remote work has become the new standard for countless individuals worldwide. A growing number of people now use their homes, or a portion thereof, as their official workspace. This trend encompasses a wide range of individuals, from the self-employed who have embraced the work-from-home lifestyle to those conducting businesses as sole proprietors, independent contractors, or owners in select partnerships. While working from home presents its own set of challenges, it also opens doors to potential tax benefits.

Professionals working from home are afforded the opportunity to claim deductions on their business income for various expenses incurred while conducting business within their home environment. Notably, if you use a specific part of your home exclusively and regularly for business purposes, you may qualify to deduct expenses such as mortgage interest, insurance, utilities, repairs, and depreciation related to that dedicated area. Calculating these deductions involves determining the percentage of your home allocated to business activities, as well as the proportionate share of utilities, repairs, and depreciation.

Home office deductions have often been a source of apprehension among taxpayers, stemming from concerns about potential IRS disallowance. Surprisingly, many eligible taxpayers who could benefit from this deduction fail to claim it.

This CE Tax Webinar aims to demystify the home office deduction by delving into its current tax law requirements and limitations. Key topics will include a comprehensive comparison of simplified versus actual expense deduction calculations, detailed documentation prerequisites to ensure due diligence, and the essential principles governing the proper utilization of office space. 

This Online CPE webinar covers the following Key Topics:

• The tests for qualifying for a deduction
• Handling separate structures
• The two methods to calculate the deduction
• Special rules for daycares
• Dealing with sales of the office property, including using the Section 121 exclusion
• Business limits
• Red flags

Join this webinar, you will possess the knowledge and skills needed to maximize this deduction for your clients.

Overview

• Qualifying for the deduction

  3 mins
• More than one business

  11 mins
• Place to meet customers

  18 mins
• Determining office area

  30 mins
• Depreciation

  30 mins
• Standard deduction

  38 mins
• Home vs. Separate structure

  43 mins
• Home office and depreciation

  47 mins