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How do I deduct if i work from home can i deduct rent on my taxes?

TL;DR

You can deduct a portion of your rent if you use part of your home exclusively and regularly for business purposes.

Detailed Answer

The home office deduction allows you to deduct expenses for the business use of your home, including rent, if you meet certain criteria. To qualify, you must use part of your home exclusively and regularly as your principal place of business or a place to meet clients or customers. The deduction can be calculated using the simplified method or the actual expenses method, where you calculate the percentage of your home used for business. For example, if your home office occupies 10% of your home's total square footage, you may be able to deduct 10% of your rent.

Where to Put It on the Tax Form

Schedule C (Form 1040), Line 30 for sole proprietors; Form 8829 for detailed expense calculation.

Real World Example

A freelance graphic designer uses a spare bedroom as an office, which is 15% of her apartment's total area. She can deduct 15% of her monthly rent as a business expense.

Calculation Required

A calculation is required for this deduction.

Calculate the percentage of your home's square footage used for business. Multiply this percentage by your total rent to determine the deductible amount.

Audit Risk & Documentation Tips

Keep detailed records of your home office space, including a floor plan and photos. Maintain copies of rental agreements and utility bills. Be prepared to demonstrate exclusive and regular use of the space for business purposes.

IRS Reference

IRS Publication 587, Business Use of Your Home

Relevant Industries

FreelancersSmall BusinessRemote WorkersConsultants

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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 15, 2025

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