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maggie236
New Member

If I am getting the Standard Deduction, does that mean that I have "excess real estate taxes" that I can deduct in the home office calculation?

 
1 Reply
GiseleD
Expert Alumni

If I am getting the Standard Deduction, does that mean that I have "excess real estate taxes" that I can deduct in the home office calculation?

If you are taking the standard deduction and not itemizing your real estate taxes, you can include your real estate taxes in your calculations for the home office deduction when electing to use the actual expense method. You cannot deduct real estate taxes in their entirety; you can only deduct the percentage that pertains to your home office. TurboTax will help you determine this percentage. 

 

However, if you use the simplified method for your home office deduction, you cannot deduct the real estate taxes. Below is some more information about the simplified method per Rev. Proc. 2013-13 (PDF):

 

  • Taxpayers can elect to calculate the deduction for using a home office for business under the simplified method rather than deduct actual expenses.
  • The simplified method is calculated by multiplying $5 by the square footage of the area in the home used for business.
  • The maximum area allowed under the simplified method is 300 square feet.
  • The simplified method simplifies recordkeeping and substantiation rules. Taxpayers do not have to separately keep track of the actual cost of utilities, maintenance, repairs, depreciation, etc.
  • When the home is sold, depreciation recapture does not apply for the period of time the simplified method was used.

 

 

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