AnnetteB6
Employee Tax Expert

Business & farm

It appears that you are on the right track.  

 

For the two W-2 jobs, any related expenses are 'employee' business expenses.  Those are not deductible on your Federal return for the 2018 through 2025 tax years due to the Tax Cuts and Jobs Act passed in 2017.  They may be deductible on your state return if your state did not comply with the Federal change (Alabama, Arkansas, California, Hawaii, Minnesota, New York and Pennsylvania).  These would be reported on Form 2106 and transferred to your state return.  However, the same home office space could not be used for your W-2 job and also for self-employment -- it would need to be further subdivided between the two types of income so it is not likely to have an effect on your state that would be worth the effort of trying to claim it since the office was only 5% of your total home square feet.

 

If your Schedule C businesses 2 and 3 were similar enough to consider them related to one another, then you can go ahead and combine them into a single Schedule C.  Given that the income for business 2 was only $200, it would not be worth the effort to try to claim a portion of the home office space for that business.  You are correct to include the home office only for business 3 based on the scenarios you provided.  

 

As for the Schedule A deductions, none of the home office or employee business expenses will affect that portion of your return to increase your deductions.  Unless you have some charitable contributions that you did not include or something else that was omitted, then just take the standard deduction.  

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