Kriss Stevens & Scott Manley - CENTURY 21 Cobb Real Estate



Posted by Kriss Stevens & Scott Manley on 6/10/2018

If you work from home either full or part-time, you may want to give the home office deduction a go on your taxes. The problem with this deduction is that it can be tricky. 


Are You Eligible?


Your workspace needs to meet the criteria for business use. You need to use your work space regularly and as your principal place of business. If you don’t work from home as a self-employed individual, your employer must require you to work from home due to a lack of office space or other circumstances. The keywords in this part of the clause are “exclusively, regularly, and must.”


First, you’ll need to calculate the percentage of your home that’s used for business. This means that if your office is 100 square feet and your home is 1,000 square feet, you use 10% of your home for business. If you own the space you’re living in, you can deduct 10% of the mortgage interest that you pay each month. Keep in mind that you can’t double dip either. This means the amount of mortgage interest that you deduct on other parts of your taxes is reduced. If you rent your home, you’d deduct the percentage off of your monthly rental payments. 


Home Office Maintenance


If you own your home, you are able to deduct a portion of your property taxes, insurance, utilities, maintenance, and other expenses that are associated with your home office space. These expenses vary because some are direct such as the expense of you painting your office. Others are indirect. Home insurance applies to your entire home, so you would only apply a portion of that to a deduction. For the direct expenses, you are able to deduct the entire cost. 


For the indirect expenses, you’ll go back to applying the percentage of your home that is used for work. This means if we’re working with a 10% figure, you are able to deduct 10% of your utilities, 10% of your home insurance premiums, and so on.


If you rent, you can still deduct many of the same things that homeowners can from your taxes for a home office expenditure. The only thing that you’ll lack as a renter is the ability to write off things like mortgage interest, property taxes, and homeowner’s insurance. Know that you’ll be able to write off a portion of your renter’s insurance. 


The Complicated Stuff: Depreciation


You are able to depreciate the value of a home office as your home ages. It’s not always necessary to do this, so you should consult your tax professional before you decide to make this type of deduction. Equipment in your office, such as your computer, can be claimed as a depreciation over time as well. 


The important thing when it comes to your home office tax deduction is to do your homework. You don’t want to miss out on important savings!




Categories: home office   tax credit  


Posted by Kriss Stevens & Scott Manley on 12/17/2017

The number of American employees who work from home, at least part of the time, is increasing year after year. Some 38% of Americans say they’re currently able to work from home at least one day a week, and that number is set to continue increasing.

Working from home can pose a few problems, however. Notably, trying to find a place within your home where you can sit down in peace and get to work.

In today’s article, we’re going to talk about home office design. So, whether you’re working from home full-time, part-time, or just want a quiet place to go over the bills in the evening, so can ensure you have the best possible environment to be productive in.

The balance between focused and comfortable

Ideally, a home office is a place that is well-lit, distraction-free, and minimal in decor. However, each of us has our own process when it comes to being productive.

So, when planning your office, it’s important to choose a style that will help you work but will also make you want to spend time in the room.

Lighting conditions

Another trait of a home office that is largely dependent on your work-preferences is the lighting quality. This covers anything from the lights you use to the windows, curtains, and even the color of your walls.

If you’re the type of person who could easily fall asleep in a dimly-lit room, it’s probably a good idea to choose a bright paint color and ample lighting. This is especially true for people who find themselves spending long hours in the evening.

Decorating your office

Now that you’ve determined what type of home office you need, let’s think about how you’re going to furnish it.

The key here is to minimize distractions. A television is probably a bad idea. But, quiet music playing on your laptop or headphones could help you focus.

In terms of decorations, a good design principle to go by is that you should decorate with a few large items rather than several small items. This will help you prevent the room from feeling cluttered.

Set yourself up for organizational success

When you envision an office, you probably picture file organizers, paper clip holders, notepads, and countless other office-related tool and accessories.

However, if you tend to do most of your work on your computer, odds are those things will just get in your way.

Instead of filling up your cart at Staples, think about the type of work you’ll be doing in your home office and purchase only what you need. This will help you stay organized and help you from losing documents and losing time trying to find those documents.

With these tips in mind, you’re ready to start creating your home office haven of productivity. Be sure to check out my other posts for more tips and advice.