Home office deduction

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Hello!

How can I calculate a home office deduction (for a sole proprietorship) for a home that I own (i.e., no mortgage interest)? What items are eligible to be included in the calculation? Does it make any difference if my home is located overseas?

Thank you!

mtufaroAnswer

Level 7

The rules for claiming the home office deduction are the same regardless of whether you live in the US or abroad. This boils down to four basic qualifications: You must be self-employed; You must exclusively use your home office for work; You must regularly use your home office for work; and Your home office must be your principal place of business.

You can use the simplified method, which is $5 per square foot of the office or actual expenses, the largest one, which is generally a mortgage. Others are insurance, utilities, repairs, maintenance, and depreciation.

Thank you for the question @cmallow17

All the best,

Marc T.

TurboTax Live Tax Expert

27 Years of Experience Helping Clients

mtufaroAnswer

Level 7

Thank you for the question @cmallow17

All the best,

Marc T.

TurboTax Live Tax Expert

27 Years of Experience Helping Clients

cmallow17Author

Level 3

Thank you, Marc, this is helpful. I was wondering if there was some other expense in lieu of a mortgage since that is the biggest expense, but alas not.

I appreciate you taking the time to explain and also listing out the requirements to qualify.

Thank you!