Hundreds of thousands of wage earners began working from home last March as the efforts to combat COVID-19 ramped up. As those folks begin to prepare their 2020 income tax returns, they have begun to question whether they can claim the cost of a home office as a federal tax deduction. The answer is no.
Prior to Tax Year 2019 and the passage of the Tax Cuts and Jobs Act (TCJA), wage earners who itemized deductions could claim various miscellaneous deductions, including a home office if one was required by their employer and the office was used solely and exclusively for business. The TCJA eliminated the ability to claim all miscellaneous deductions, including a home office.
Some states, such as California, still allow wage earners to claim a home office required by their employer and used solely and exclusively for business. The space doesn't have to be a separate room but it can't be a space used for other things. Be sure to check with your tax preparer to see if your state allows a home office deduction and, if so, what requirements must be met in order to claim the deduction.
Prior to Tax Year 2019 and the passage of the Tax Cuts and Jobs Act (TCJA), wage earners who itemized deductions could claim various miscellaneous deductions, including a home office if one was required by their employer and the office was used solely and exclusively for business. The TCJA eliminated the ability to claim all miscellaneous deductions, including a home office.
Some states, such as California, still allow wage earners to claim a home office required by their employer and used solely and exclusively for business. The space doesn't have to be a separate room but it can't be a space used for other things. Be sure to check with your tax preparer to see if your state allows a home office deduction and, if so, what requirements must be met in order to claim the deduction.
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