Home Office Tax Deduction Explained: When You Can Write Off Home Office Expenses

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Working from home can save time and money, but can you write off home office expenses on your taxes? The answer depends entirely on how you work, who you work for and how your home office is used. Many taxpayers assume remote work automatically qualifies them for a deduction — but IRS rules are far more specific.

The Internal Revenue Service sets strict rules for home office deductions, and most W-2 employees are no longer eligible under current law.

This guide explains when the home office deduction is allowed, when it isn’t, how the IRS defines a qualifying home office and which expenses may be deductible, all in clear, plain language based on current IRS guidance.

Quick Answer: Can You Write Off Home Office Expenses?

You can generally deduct home office expenses only if you are self-employed or run a business from your home. You usually can’t claim the home office deduction if:

• You are a W-2 employee
• You work remotely for an employer
• Your home office is used part-time or for personal purposes

Eligibility hinges on exclusive and regular use for business.

Home Office Deduction At a Glance

Why Most Employees Can’t Claim the Home Office Deduction

Under current federal law, unreimbursed employee business expenses are not deductible for most taxpayers. This change came from the Tax Cuts and Jobs Act, which suspended these deductions through at least 2025.

That means even if:

• Your employer requires remote work
• You have a dedicated home office
• You receive no reimbursement

You generally can’t deduct home office expenses as an employee.

Who Can Claim the Home Office Deduction?

You may qualify if you are:

• Self-employed
• An independent contractor
• A freelancer
• A small business owner operating from home

These taxpayers typically file Schedule C, where the home office deduction is calculated.

The IRS “Exclusive and Regular Use” Test

To qualify, your home office must meet both tests.

Exclusive Use Test

The space must be used only for business. You fail this test if:

• The space doubles as a guest room
• Family members use it for personal activities
• You work there occasionally, but not exclusively

A clearly defined business-only area is required.

Regular Use Test

You must use the space on an ongoing basis for business. Occasional or incidental use doesn’t qualify.

Principal Place of Business Test

Your home office must be your primary location for business activity or where you regularly meet clients. This can still qualify even if you perform some work outside the home.

Which Home Office Expenses Are Deductible?

If you qualify, you may deduct a portion of:

• Rent or mortgage interest
• Property taxes
• Utilities
• Internet
• Homeowners insurance
• Repairs and maintenance

Only the business portion is deductible.

Simplified Method vs. Actual Expense Method

The IRS allows two calculation options:

Simplified Method

• $5 per square foot
• Maximum of 300 square feet
• Maximum deduction of $1,500

Actual Expense Method

• Deduct a percentage of actual home expenses
• Based on office square footage
• Requires detailed records

This method can produce a larger deduction but requires more documentation.

Example: How the Home Office Deduction Works

If your home is 2,000 square feet and your office is 200 square feet:

• Business use percentage: 10%
• You may deduct 10% of eligible home expenses

The IRS stresses that only expenses tied to business use qualify.

When You Cannot Write Off Home Office Expenses

You generally can’t deduct home office expenses if:

• You are a W-2 employee
• The space is used for personal activities
• The space is not used regularly
• The space is not your principal place of business

These are common audit triggers.

Recordkeeping Matters

The IRS recommends keeping:

• Floor plans or measurements
• Utility bills
• Rent or mortgage statements
• Repair receipts

Records should be kept for at least three years.

Is the Home Office Deduction Worth It?

For eligible taxpayers, it can reduce taxable income meaningfully. For ineligible taxpayers, attempting to claim it can increase audit risk. The IRS continues to list improper home office claims as a common filing error.

Final Take to GO

You can write off home office expenses only if you meet strict IRS rules. Self-employed taxpayers may qualify if the space is used exclusively and regularly for business. Most employees, including remote and hybrid workers, cannot claim the deduction under current law.

Understanding the difference can help you avoid mistakes and claim the deduction only when you’re truly eligible.

Information is accurate as of Jan. 15, 2026.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

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