New Home Office Deduction for 2013
Tax Preparation for a home office deduction just got a little easier:
The Internal Revenue Service has announced that for 2013 a simplified method for claiming the home office deduction will be available. The IRS’ goal is to reduce the paperwork and time involved for CPAs, tax preparers, and tax filers alike.
Currently, a tax filer who desires to claim a home office deduction must fill out the 43-line Form 8829. This form factors in expenses such as depreciation, carryovers, and allocation of other home related expenses involved for their home office deduction. The new form, which is not yet released, will be significantly simpler.
This new option for taking a home office deduction will still follow the IRS home office rules http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Home-Office-Deduction but will offer an easier way to track and report the deductions.
The new simplified option allows the tax payer to deduct $5 a square foot for a home office up to a maximum of 300 square feet. This will provide a maximum deduction of $1,500 using the simplified form. The form 8829 will still be available for taxpayers who have deductions in excess of the cap.
Unfortunately this new form and procedure for the home office deduction will not be available for the current tax season (tax year 2012) and as mentioned previously the IRS restrictions and definitions for a home office deduction still apply.
More tax preparation information on this new option can be located at http://www.irs.gov/pub/irs-drop/rp-13-13.pdf.
