Can I deduct my home office?
Business owners, freelancers and employees that telecommute can usually claim their home office on their federal taxes and deduct a portion of the home's expenses. Homeowners and renters can both qualify for this deduction; the IRS recognizes houses, condos, apartments and free-standing structures as home business sites.
To claim your home office on your federal taxes, your home office must meet the two home business qualifications:
Exclusive Use means that there is a specific area within your home that is used exclusive to run your business and no other activities occur there. This area can include a room or a section of an area portioned off for business activity, a space used for inventory storage, or a separate free-standing building on the property such as a storage shed, garage or studio.
However, if you regularly meet with clients in the living room or write freelance copy on the couch in the family room, your home office will not qualify as an exclusive place of business.
Regular Use means that you use your home as a business on a regular schedule; anywhere from a few hours a week to daily use can qualify as long as you can show that the home is the primary business area. Business owners who provide services outside of the home, for instance carpet cleaners, construction contractors and home repair providers can also qualify if they manage their business in their home.