The IRS is reducing the recordkeeping required for the
home-office deduction, effective for 2013. Taxpayers who qualify may use a new
optional deduction calculated at $5 a square foot for up to 300 square feet of
an area in a home that is used regularly and exclusively for business. The
deduction is capped at $1,500 a year.
Taxpayers opting for the simplified deduction cannot
depreciate a portion of the home as they can under the other method. However,
business expenses not related to the home, such as advertising, supplies, and
employee wages, are still fully deductible.
This simplified option is available starting with the 2013
tax return which will be filed in 2014.
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