IRS simplifying home office deductions

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Reporter - Elizabeth Fields
Photographer - Mason Watkins

MCCRACKEN COUNTY, Ky. - The number of homes with home offices is growing and tax experts predict the number of people filing for a home office tax deduction will grow this year, too, especially now that the IRS is offering a simplified method.

Dean Owen, CPA, said many people found the complicated task of collecting every receipt and taking meticulous notes throughout the year too daunting to file the deduction and not worth the payoff. With this new option, there's no collecting receipts because the deduction is calculated solely on the square footage. This year they're offering a flat $5 a square foot, but there is a cap of $1500.

"If your home office is 300 square feet or smaller, the new rules will save you some time, money and effort," said Owen. "If it's larger than 300, now you're getting into a more substantial home office and you're going to have to do the math."

Owen said a home office is defined as a "designated space to work at for the convenience of your employer." Cell phones on the night stand don't count and laptops on the couch are also hard to defend, but he said if you have a legitimate office homeowners shouldn't worry about the IRS asking questions.

If you have questions about if your home office qualifies, you should talk to the person who prepares your taxes about it or you can contact the IRS.

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