Money Talks News: Tax Hacks 2014: Home Office Deductions
Wed, 12 Feb 2014 13:15:50 GMT —
If you work at home and don't take a home office deduction, you could be flushing money down the tax toilet.
A home office deduction could literally add up to thousands of dollars because you're allowed to deduct part of your mortgage and your utilities.
But the rules here are very specific. Here's what you need to remember: P and E.
The P stands for "principle" or primary place of business.
The E stands for "exclusive," meaning it is exclusively used for business. A double-duty space, like your living room or dining table does not qualify.
Here's a common question: what if you're an employee, but you sometimes work at home or occasionally telecommute?
The answer is: If you're working at home for your employer's convenience, maybe yes. But if they're letting you work at home for your convenience, probably not.
Something new this filing season: a simplified option to figure out the home office deduction.
The qualification rules are the same, it just makes record keeping and expense calculations a bit easier.
So if you think you might qualify for a home office deduction, definitely check it out.
What you want to do is look for IRS publication 587. Or better yet, just go to moneytalksnews.com and do a search for "Tax Hacks 2014."
For Money Talks News, I'm Stacy Johnson.