Home Office Deduction

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Home office expenses are currently not deductible by an employee for federal tax purposes. But they are deductible for NYS (as long as misc. itemized deductions, in total, exceed 2% of AGI). How is the information input to get the home office deduction for NY?

TurboTax Home & Biz Windows

rjs

Level 15

You have to enter the home office deduction in the federal section of TurboTax, even though it won't be used on the federal tax return. The deduction will flow to the New York tax return. Here's how to enter the home office deduction.

In TurboTax Home & Business click the Personal Tab. (In other editions click the Federal Taxes tab.)
Click Deductions & Credits.
Click "I'll choose what I work on."
On the screen "Your 2021 Deductions & Credits," scroll down to the Employment Expenses section.
Click the Start button for Job-Related Expenses.
After a few preliminary questions you will get a screen that says "Did you have home office expenses?" Select Yes and proceed through the questions to enter the home office information.

superman23Author

Level 5

Thank you for that clear and thorough response. I now see where the input fields are.

There are notes on the screen stating that an employee cannot take the home office deduction if they worked from home due to COVID-19, as that would not satisfy the "convenience of employer " rule.

I know this is a technical question (as opposed to a TT question), but do we know that this is New York State's position? I have been unable to find anything on point. Is there some authority you can direct me to? We have a situation where the taxpayer was not permitted to work in their office for a time in 2021.

Thanks so much!

rjs

Level 15

I can't find any authoritative guidance either. Of course, the note in TurboTax is also not authoritative. We don't know what the basis for that statement is, or if they even have any authoritative basis for it.

New York's position is basically that you can claim the deduction if you could have claimed it under the federal rules that were in effect prior to 2018. I would take the deduction based on the reasoning that if the employer makes you work at home, it's obviously "a condition of employment," and for the convenience of the employer. Maybe what TurboTax means is that you can't claim it if you chose to work at home to avoid exposure to Covid-19, but your employer would have allowed you to come to the company office if you wanted to.

This is just my personal opinion, of course.