Can I Write This Off?

Can I write off utilities if working from home?

TL;DR

Yes, you can write off utilities if you qualify for the home office deduction.

Detailed Answer

Utilities can be deducted as part of the home office deduction if you use a portion of your home exclusively and regularly for business purposes. This includes expenses like electricity, heating, and water. However, only the portion of these expenses that directly relates to the business use of your home is deductible. For example, if your home office occupies 10% of your home's square footage, you can deduct 10% of your utility bills.

Where to Put It on the Tax Form

Schedule C (Form 1040) for sole proprietors, or Form 8829 for business use of home.

Real World Example

A freelance graphic designer who works from a dedicated office space in their home can calculate the percentage of their home used for business and apply that percentage to their utility bills to determine the deductible amount.

Calculation Required

A calculation is required for this deduction.

To calculate the deductible amount, determine the percentage of your home used for business by dividing the square footage of your home office by the total square footage of your home. Apply this percentage to your total utility expenses to find the deductible portion.

Audit Risk & Documentation Tips

To minimize audit risk, maintain clear records of the size of your home and office space, utility bills, and any calculations used to determine the deductible amount. Keep documentation for at least three years.

IRS Reference

IRS Publication 587

Relevant Industries

FreelancersSmall BusinessRemote WorkersConsultants

Disclaimer: This is for informational purposes only and should not be construed as tax or legal advice. Always consult your tax advisor.

Page created on July 7, 2025

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