Don't overlook your home office

If you use a portion of your home for business, you may be able to take a home office deduction whether you are self-employed or an employee. Expenses that you may be able to deduct for business use of the home may include the business portion of real estate taxes, mortgage interest, rent, utilities, insurance, depreciation, painting, and repairs.


You may claim this deduction for the business use of part of your home only if you use that part regularly and exclusively:

  • As your principal place of business for any trade or business; or
  • As a place to meet or deal with your patients, clients, or customers in the normal course of your trade or business.

Generally, the amount you can deduct depends on the percentage of your home that you used for business. Your deduction will be limited if your gross income from your business is less than your total business expenses. The percentage of your home used for business is based on either the total number of rooms or square footage. If you use a separate structure not attached to your home for an exclusive and regular part of your business, you can deduct expenses related to it.

If you are an employee, you have additional requirements to meet. The regular and exclusive business use must be for the convenience of your employer. This means you are not allowed a home-office deduction if your employer does not require you to work at home.

Tax Tips Small Business

  • Determining Qualified Business Expenses

    Be sure to deduct every legitimate expense

    Amounts you spend in the course of conducting business are generally deductible from the gross income of that business. This includes any start-up expenses. You can claim amounts spent for items ordinary and necessary in your trade or business as a deduction against your income. Otherwise, the amounts are amortized, depreciated, or expensed depending on the nature of the purchases.

    Read more ...

Small Business Quick Tip

  • Business Mileage Rate 2

    The optional standard mileage rate for the business use of an automobile is 54 cents per mile in 2016.
Monday, 21st August 2017
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Tax Tips Personal

  • Interest on Summer Recreation May Be Deductible

    Your motor home or boat could yield a deduction

    If you own a boat or motor home that is fully equipped with kitchen and sanitary facilities and you use it as a "second" home, the interest you pay on it is probably deductible on your tax return. Although a fishing boat without facilities won't qualify, most motor homes and campers do. If you're looking to buy a boat that doesn't qualify as a second home, you may want to consider paying for it with a home equity loan. That way, the interest is generally deductible. As with most tax rules, there are exceptions and limits so check with a tax expert before you sign on the dotted line.

Personal Quick Tip

  • Organized Appointment

    Go to your tax appointment well organized. Have all your income statements such as W-2s and 1099s separate from your expenses. Make sure you have all the proper social security numbers for dependents, as well as their names as they appear on their social security card. Careful organization will save you time come tax season.