Decor and Taxes: Working from Home

by Tricia Cyr 12/01/2019

Photo by RawPixel via Pixabay

The sky's the limit for cloud-based documents and files. Remote working is on the rise. The ranks of independent entrepreneurs are growing. For many, home is a place to live and work.

Here are three elements to consider for your work-from-home space.

1. Choose Your Workspace

Pick a bright spot. Daylight inspires!

Will you be having clients drop in? Aim to choose a spot near an entrance way, apart from your intimate living spaces.

For tax purposes, this spot can be a dedicated room, or a section of a room—as long as there's a clear division between your working and living space. Other storage areas in the home, or partitioned-off space that's fully dedicated to keeping business items, is also square footage to count in the deduction.

Take pictures each year that clearly show the partitions and the business use of the space. Keep your photos with your tax documents.

2. Furnish the Space

Decorate mainly as you would if your work space were in a corporate building. Keep your desk, professional items, and office-appropriate décor in the space. Don't have a playpen (unless your business is daycare) or a dining table in your designated office space.

Bookcases, wall hangings, mirrors, and framed art all look good, and dampen noise from outside your work space. Succulents or crocus bulbs can make excellent office plants and uplift the mood of your work area.

Protect your health while working at home by using an adjustable (sit-stand) desk. Does that sound too industrial for the look you demand at home? Never fear. Gorgeous, adjustable desks that complement your existing furniture do exist on the market. With a little searching, you'll find yours.

3. Declare Your Tax Deduction

Calculate your home office percentage. If your home amounts to 2,000 square feet and your office space covers 500, declare 25% as the percentage. The deduction may not exceed your year's net business profit. 

For smaller home office spaces, the IRS has a simplified standard deduction. Take $5 per square foot, up to 300 square feet.

Speak with your tax pro about deducting a home business percentage from your homeowner's insurance, mortgage interest, utilities, and property taxes. Read the instructions, so you know how to plan your tax return.

Putting It All Together

For a tax deduction, your home office must serve as the core of your business affairs, or the place you do the bulk of your work. Whether you already have a home office, or are thinking of creating one, design your space so it fits the IRS tax deduction requirements—even while it uplifts your home, delights your senses, and inspires your best work. 

About the Author
Author

Tricia Cyr

Tricia Cyr is the owner /broker of CYR Real Estate, a Connecticut real estate company that has been in business for 27 years. After working for a small real estate firm located in Branford, she decided to start her own real estate company. Not only has she been actively selling real estate on the Connecticut shoreline for over 27 years, but she is also a lifetime resident of the shoreline. "I am a full-time real estate broker who knows what it takes to get the job done, allowing you to have complete confidence that you will be well represented. I give personal attention, always keeping myself accessible. I return my phone calls promptly.”

Tricia is energetic, efficient, honest, dependable and always working with your best interest in mind. Offering the highest quality of service and will make your real estate experience a pleasant one. Cyr Real Estate has been generating repeat clients and personal referrals for 27 years. We use all the latest technology & tools to successfully market all our properties. If you are interested in buying or selling a home, or if you need help with property management, please consider Cyr Real Estate 203-481-6638 New Haven Middlesex Association of Realtors | Connecticut Association of Realtors National Association of Realtors | Shoreline Chamber of Commerce.