Using the same home office space for a remote job as well as contractual self-employment work

[DB1990]

Can I claim the office space that I use for self-employment work for a deduction if it is the same desk and space that I use when I work my hybrid/salaried W2 job?

Or because it has a dual purpose, does that mean it's ineligible as a deduction?

[Critter-3]

Or because it has a dual purpose, does that mean it's ineligible as a deduction?   BINGO ... since it is not used exclusively for the SE income it is ineligible. 

[ElizabethW2 · Accepted solution]

Hi!

Because the space isn't used exclusively for your self-employment work, you will have some limitations.  TurboTax will land you on a screen that asks about sharing the space for other work or with another person.  You would indicate that you use it for another business (your W2 salaried position) and would need to be sure to answer the questions about the percentage of work done in the office.  The Tax Cuts and Jobs Act of 2017 suspended unreimbursed employee business expenses so you won't have a deduction for the use of the office while conducting the work for your salaried position.

If this information was helpful, please indicate by clicking the thumbs up below.

Elizabeth W, EA

[rschule1]

Hi There:

A lot of good advice has been given. Here's a link from Turbo Tax which answers a lot of questions:

Office in the home

The above link specifically states:

Who can claim 2022 tax deductions when working from home?

Since the 2018  tax reform became law, generally only self-employed people can claim tax deductions when working from home. Working as an employee and for yourself doesn’t necessarily disqualify you from taking these tax deductions. The deductions have to be related to your self-employed income rather than your employee work.

Even in this situation, you’ll generally need to make sure your home office is only in support of your self-employment and not your job as an employee. For other expenses such as phone and Internet, you can split these between working for yourself, as an employee or as a personal expense. For deducting home office space on your tax return, the IRS requires these expenses to be used exclusively for your self-employed business.

To claim a home office as a business expense, you must use part of your home as your principal place of business or a place where you regularly meet greeting clients or customers or store inventory. If your home office is a separate structure then it does no have to be your principal place of business.