Simplified Home Office Deduction

Recently, the IRS released an announcement concerning a simplied home-office deduction for home-based businesses beginning in 2013. While the same rules apply to determining if the use of your home is deductible as a business expense, the record-keeping and hassle of keeping track of those expenses is simplified. The simplified method allows for an annual deduction of $5 per square-foot up to $1,500. In addition, you do not need to allocate mortgage interest and real estate taxes between personal and business expenses which allows you to deduct those if you itemize deductions. Read the full announcement on the IRS site.