3 Reasons You Can’t Claim a Home Office Deduction — Even if You Work From Home

This post may contain affiliate links which may compensate us based on your interaction. Please read the disclosures for more information.

Doing your job from home does not automatically mean you’re eligible for a home office deduction. Read on to see why. [[{“value”:”

At this point, many people are deep in the throes of doing their taxes. And your goal may be to try to eke out the most savings on your return as you can. To that end, it pays to claim any tax credits you’re entitled to, as they’ll reduce your IRS liability on a dollar-for-dollar basis. It also pays to capitalize on tax deductions you’re eligible for, since those serve the very important purpose of exempting some of your income from taxes.

READ MORE: The Ascent’s Complete Guide to Taxes

One tax deduction you may be looking to claim is the home office deduction. But don’t assume that this deduction is available to you simply because you do your job from home.

There are rules you need to follow to claim the home office deduction. And here are three reasons why you may not be able to do so.

1. You’re not self-employed

If you’re self-employed and/or own your own small business, you may be able to claim a home office deduction on your taxes. But if you’re a salaried employee, the home office deduction is off the table.

It doesn’t matter if you do your job 100% remotely. You cannot claim this deduction if you’re a company’s employee.

2. You don’t have a dedicated space used solely for work purposes

Maybe you are self-employed. If that’s the case, claiming a home office on your taxes may be possible if you have a dedicated area in your home that’s used solely for work purposes. If not, then the deduction isn’t for you.

Let’s say you rent a one-bedroom apartment and have your work desk between your bed and dresser. In that case, the home office deduction won’t fly because that room isn’t being used solely for work purposes — it’s also where you get dressed and sleep.

On the other hand, let’s say you rent a two-bedroom apartment, where one room serves as your bedroom and the other serves as your office. In that case, you may be eligible for a home office deduction because you have a dedicated space used only for work purposes — not work plus another purpose.

3. Your home office isn’t your primary office

Maybe you’re self-employed and there is, indeed, a room in your home used only for work. If you also rent office space in town and use your home office just a few hours a week, it’s not a deduction you can claim. That’s because eligibility for the home office deduction hinges on your home office being your primary office.

In that situation, you should, in theory, be able to deduct the cost of renting your office space (though you should always consult a tax professional before making decisions like these). But your home office needs to be the place you clock in most of your working hours to land you a deduction.

The home office deduction can be a bit confusing. In addition to eligibility requirements that you may not fully understand, there are also a couple of different ways you can calculate the value of that deduction. That’s why it’s a good idea to hire a professional to complete your tax return, especially if you’re self-employed or own a business. A professional can help you identify which tax breaks you should and shouldn’t be claiming so you can minimize your IRS debt or maximize your tax refund.

Alert: our top-rated cash back card now has 0% intro APR until 2025

This credit card is not just good – it’s so exceptional that our experts use it personally. It features a lengthy 0% intro APR period, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to read our full review for free and apply in just 2 minutes.

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

“}]] Read More