Partial year Home office deduction

[ashleyerossi]

Hi, I was solely self employed for the first 3 months of 2023 (and for 6 years previously). I own my home and have alway opted into actual expenses (5.57% of entire home) vs simplified, so I’m continuing that method this year.

I’m getting hung up on how to enter my mortgage interest and real estate taxes for only the part of the year for which I was self employed. Turbo tax asks how many months the home office was in use, but I’m not sure if this question results in an automatic timeframe calculation? And if not, do I just manually calculate it for 3 months? 

I should also note that taking the standard deduction is my best bet.

Thanks in advance for you help!

[AnnetteB6]

Based on entering a test case in TurboTax, the number of months that the office is used during the year does not factor in to the amount of mortgage interest or property tax that you enter.  The number of months is used to calculate the home office deduction based on the Simplified Method only.

You should prorate the amounts for the mortgage interest and property tax before entering the amounts into the home office section of your Schedule C.

Take a look at your Form 8829 before filing your return to be sure that the calculations make sense for your situation.  The mortgage interest and property tax deductions will be on lines 10 and 11.  This is the number before calculating the portion applicable to the home office based on the square footage.  That result is on line 13.