A great tax benefit that comes with qualifying your home office is that a portion of your personal expenses to maintain your home becomes deductible.
Some of these expenses are not deductible otherwise. But even for those that are already deductible, such as your mortgage interest and property taxes, the way in which the home office calculation works, your deduction for these items is not subject to the limitations that otherwise apply.
This all boils down to tax savings!
Track and record (and pay) these expenses personally:
_____ Mortgage interest
_____ Property taxes
_____ Homeowner’s insurance
_____ HOA dues
_____ Pest control
_____ Other expenses that relate to the running of your entire home
Certain expenses are non-deductible. This includes pool maintenance, lawn maintenance, landscaping and the first phone line into your home.
Business expenses for your home office are expenses that your business has regardless of where your office is located.
Have your business track and record (and pay) these expenses directly:
Understanding the rules is a key part of maximizing your tax savings. This is true in most developed countries.
The home office deduction is a good example of this. A home office deduction is allowed for those who work out of their home, but it can be tricky to understand which expenses to track and who should record and pay for the expenses.
The home office is one of the best types of deductions because it turns expenses you already have into deductible expenses. This means it is eliminating tax and that is the best type of tax planning.
To ensure compliance with requirements imposed by the IRS, we inform you that any US federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and it cannot be used for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein. If you are not the original addressee of this communication, you should seek advice based on your particular circumstances from an independent advisor.