Max 300 sq ft for simplified method
Deduction Amount
$1,000
Method Used
simplified
Office Space
200 sq ft
What is the simplified method for home office deduction?
The simplified method allows you to deduct $5 per square foot of your home used for business, up to a maximum of 300 square feet ($1,500 maximum deduction). This method requires less record-keeping compared to the regular method and is available to self-employed individuals and qualifying home-based businesses.
What expenses qualify for the regular home office deduction?
Under the regular method, you can deduct a proportional share of home expenses including mortgage interest or rent, utilities (electric, gas, water), homeowner's insurance, repairs and maintenance, depreciation, and property taxes. The deduction is based on the percentage of your home used exclusively and regularly for business.
Can W-2 employees claim the home office deduction?
No. Since the Tax Cuts and Jobs Act of 2017, W-2 employees can no longer claim the home office deduction on their federal tax returns, even if they work from home. This deduction is now available only to self-employed individuals, independent contractors, and qualifying business owners.
What is the $5 per square foot limit?
Under the simplified method, the IRS allows a flat rate of $5 per square foot of qualified home office space, capped at 300 square feet. This means the maximum simplified deduction is $1,500 per year. The space must be used regularly and exclusively for business purposes.
IRS-Aligned: This calculator uses official IRS rates for the 2025 tax year. Results are estimates -- consult a qualified CPA for advice specific to your situation.
Disclaimer: This calculator provides estimates based on current IRS rates and thresholds for the 2025 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your filing status, state of residence, deductions, and individual circumstances. Always consult a qualified tax professional or CPA before making financial decisions. Read our terms
This calculator uses official rates and thresholds from:
Last verified: March 2026 · Tax year 2025. Results are indicative — consult a qualified accountant for personalised advice.