Self Employment Success Huntington NY
Company: Planning Financial Futures, Inc.
Investment Advisor Rep: Yes
SUNY Binghamton / Economics
College Of Financial Planning / CFP
Years Experience: 20
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Self Employment Success
It's the modern American dream, isn't it? You wake up at 9 a.m. You make yourself a homemade cup of joe. You stay in your pajamas. And you get paid too. But the IRS has a few caveats to making the work-at-home dream, well, work. Here are a few tax tips so you can stay ahead on your taxes:
Deducting Expenses for a Home Office
In 1999, the rules for deducting expenses associated with a home office were loosened significantly, allowing many people who were previously denied the deduction to begin claiming it. If you're self-employed and use a portion of your home regularly and exclusively for the record keeping and management functions of your business, and you have no other location where you regularly perform such functions, you may qualify for a home-office deduction.
The rules are trickier for employees who work at home. Keep in mind that the use of a home office by an employee must be required by the employer, not merely permitted by the employer.
Don't Get Comfortable in Your Office Furniture
Here's another caveat: if you want to write off your new home office desk chair, don't even think about sitting in it after business hours. You can deduct the cost of your office furniture only if it is used for business 100 percent of the time. Ordinarily you would depreciate that cost over several years, but the section 179 expense deduction allows you to deduct the entire cost in the year of purchase if you qualify.
No matter how you figure it, a home office is definitely a complex deduction - there are a lot of regulations that surround it. We recommend you seek advice from your tax professional if you're planning to take this one....
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