You have two options here. Assuming the garage qualifies as a home office, you may choose one of these options to deduct your home office expenses:
- The simplified option has a rate of $5 a square foot for business use of the home. The maximum size for this option is 300 square feet. The maximum deduction under this method is $1,500.
- When using the regular method, deductions for a home office are based on the percentage of the home devoted to business use. Taxpayers who use a whole room or part of a room for conducting their business need to figure out the percentage of the home used for business activities to deduct indirect expenses. Direct expenses are deducted in full.
There are certain expenses taxpayers can deduct. These may include mortgage interest, insurance, utilities, repairs, maintenance, depreciation and rent. Keep in mind that the deductible amount of these types of expenses may be limited. Below is a link to a TurboTax article regarding the home office deduction which you may find helpful.
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