W2 and Co-working / We Work deduction

[Anonymous]

Is CoWorking space tax-deductible when you are a W2 employee? Instead of using the house as a home-office was a better idea to rent out a desk for a monthly fee. Is that subscription deductible?

[xmasbaby0 · Accepted solution]

Sorry---W-2 employees cannot deduct job-related expenses on a federal return.  Job-related expenses were eliminated as a federal deduction for W-2 employees by the tax laws that changed for 2018 and beyond.  Your state tax laws might be different in AL, AR, CA, HI, MN, NY or PA.

https://ttlc.intuit.com/questions/4482873-which-federal-tax-deductions-have-been-suspended-by-tax-re...

[chandragelli]

I live & work in California. I am renting co-working space from Jan 2021 to have a separation between living and working space and avoid commuting to work location.  Can I take a tax deduction at CA state level for the amount I spent on renting co-working space?

[PattiF]

Yes, this would be deductible for the state of California return. 

Coworking space rentals are deductible because they technically count as a home office, and home offices qualify for deductions if they are used regularly and exclusively for business. The words “regularly” and “exclusively” are of utmost importance in this scenario: Regularly means that you use this space habitually to conduct the majority of your administrative business operations, and exclusively signifies that you don’t use this part of your home for anything but work purposes, disqualifying your bed or couch, for example.

@chandragelli