The Home Office Deduction - Uncle Sam Will Pay You to Work From Home

Take advantage of the home office deduction allowed by the IRS.

Did you know that about fifty percent of your income goes to paying taxes? This really is driving me nuts because I don't think we realize how much taxes cost us each year.

I'm on this subject lately because I met with my CPA recently to finish last year's taxes - finally. We are also planning next year's tax strategies. Since I now work from home full time I wanted to learn more about the home office deduction.

A mentor of mine once said: "It is irresponsible and sloppy stewardship of your money if you don't educate yourself on taxes."

You can reduce the amount of taxes you pay each year by taking advantage of the home office deduction allowed by the IRS.  

 According the IRS:

Your home office must be used exclusively and regularly. It must be your principle place of business where you meet clients and conduct your business.
In other words, your home office must be a place in your home that is used for business only. It may not be used for personal or family activities, or activities not associated with your business.
 The home office must be used regularly not just occasionally. Assuming your home office deduction meets the criteria given above you will be able to deduct a portion of the utilities, taxes, rent, mortgage interest, and depreciation based on square foot size of your office vs. your home.For example, the office space in your home is 200 square feet. Your home is 2000 square feet. These numbers would allow you deduct 10% of the utilities, taxes, rent, etc.

There are some items on the list above that can't be deducted if you rent your home - like depreciation and mortgage interest.

Please consult your tax advisor to educate yourself about other tax deductions and take advantage of them!

Everyone has different circumstances and the tax laws change rapidly.

You can see my previous post here on taking advantage of the mileage deduction.

Greg Dullum is currently a internet marketer and network marketer. Please contact him at http://www.greganddarcy.com.