subject: Deductions For Working At Home [print this page] Finding the balance of working from your home and actually being at home can be very frustrating. There are a lot of moms and dads in our society today that are working to find this balance.
Choosing to work from your home can be very beneficial. There are many people who find that the career they are most passionate about is best done from their own home.
Some parents did not even choose to work at home but instead the company that they were working for asked them if they would work from home. This is becoming more and more popular for companies to ask employees to work from home.
When someone can work from home they can decrease the amount of money that they cost their company. Not only will they you use your own computer and your own electricity at home but then you will also save your money on gas.
If you are working from home it is important that you know what tax deductions you are able to make when you file your taxes. These deductions are well worth your time to research and educate yourself about.
First, you should deduct the cost of your home office. A home office has to meet specific requirements before it can be deducted.
This area of your home must be used consistently, regularly and exclusively for you work. This means that if your office is used for different purposes it cannot be deducted.
It is well worth your time to designate an area that is specifically for the use of working. This may mean that you have to purchase another computer and make sure that your family knows that your office space is off limits for recreation.
There are some people that will try to claim their family den from home if they sit down to write an occasional e-mail or invoice. If the government finds out that this is the area that you are looking to deduct your deduction will be denied.
Your place of business must be either your primary place of business or you must be consistently meeting with your patients, customers or clients. If you are working in your garage or even a guesthouse it can still count.
There are some people that work from home in a management position. It was not until just a few years ago that the Internal Revenue Service broadened the business activities that could be used to determine what a home office really is.
If you are only participating in administrative duties from your home your home needs to be the only place that you can complete these duties. Some of these duties may include different billing operations, keep your books and records or even setting up appointments.
When you start to file your taxes you should make sure that you find exactly what deductions you can make. You should make sure that you sit down with a tax professional that is current with all of the tax laws.
If you are just an average citizen you may not know the ins and outs of the laws. The tax professionals are paid to keep themselves updated on the laws.
Some of the specific costs that you can deduct are a portion of your real estate taxes, some of your rent, utilities, insurance, painting and even repairs. The percentage of these costs that you are able to deduct depends on the percentage of your home that you use for your business.
The larger your home office is the more you will be able to deduct when tax season rolls around. There are many reasons why people used to not want to claim their home office when they filed their taxes.
First, it used to be law that once you sold your house you would owe taxes on the home office that you had been claiming for the duration that you had been claiming it. It was not until the end of 2002 that the Internal Revenue Service renounced this law.
There are still certain laws that specify specific situations in which you may have to pay taxes on the home office that you work from. This is another reason why working with a tax professional will be very beneficial.
Working from home has become very popular in our society. There are a long list of pros and cons that come with working from home.
If you decide that working from home is right for you, you should make sure that you deduct the right amount of money when you file your taxes.
