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Article Date:
July 2013

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New IRS Optional Method for Home-Office Tax Deduction: A Good Deal?

The IRS has a deal for you.


The IRS? A deal? Who do you think is going to benefit the most?


You’ve heard the sarcastic comment: “I’m from the government, and I’m here to help you.”


In this case, perhaps it’s true for you, or perhaps it’s not. Let’s find out if the IRS hates you.


New Optional Method


Beginning January 1, 2013, you may use the IRS’s new optional home-office deduction method rather than calculate, allocate, and prove your home-office expenses.1


The new IRS optional method is easy. There are two steps:2



Identify the square footage of your home office (limited to a maximum of 300 square feet).


Multiply the square footage times $5 a foot.


Example. You have a deductible home office in a room that measures 15' x 12', which gives you 180 square feet of home-office space. Your IRS optional home-office tax deduction is $900 (180 times $5).


Actual Expenses


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