You're also pretty much asking to get audited if you claim a home office deduction, so make sure you have your ducks in a row if you are going to claim it.
No. Read through the IRS publication linked from several of the comments. It's pretty clear that if you're using your home office out of convenience for yourself it's not deductible.
> Additional tests for employee use. If you are an em- ployee and you use a part of your home for business, you may qualify for a deduction for its business use. You must meet the tests discussed earlier plus:
> Your business use must be for the convenience of your employer, and
If you have another place to do your work (i.e. your employer's office building) you also don't qualify.
> Your home office will qualify as your principal place of business if you meet the following requirements.
> ...
> You have no other fixed location where you conduct substantial administrative or management activities of your trade or business.
You can probably get away with taking the deduction but good luck if you get audited.
There pretty clearly isn't based on what the comment said. Part time work from home implies that it's for the convenience of the employee and also that the employee has another place that they also work, either of which is sufficient to make the deduction disallowed.
I was following the flow chart in the publication, I think there can be good cause to deduct a home office for an employee because "a few days a week" could very well be the majority of the hours worked, and having a dedicated space helps. You're assuming they work less than half the time at home, and that it is strictly for their convenience and not the employers. Those were not my assumptions. If an employer offers work from home they obviously derive benefit from it (perhaps better retention rates or easier recruiting).
Like I said, there is clearly the opportunity to deduct this expense. There are obvious pitfalls that you pointed out.
> I was following the flow chart in the publication
There are two questions on the flowchart that seem to clearly rule out toxican's home office from being deductible.
Do you work at home
for the convenience of
your employer?
Probably not. Working from home a few days a week is generally something done for the convenience of the employee.
Is it your principal place
of business?
Almost certainly not. Principal place of business is not defined to be where you do most of your work, according to the IRS. They clearly state that "You have no other fixed location where you conduct substantial administrative or management activities of
your trade or business."
Toxican stated that he does not work exclusively from home. Unless he basically does no work in his employer's provided office (even a day a week is certainly substantial), he's not eligible for the deduction.
> I think there can be good cause to deduct a home office for an employee because "a few days a week" could very well be the majority of the hours worked, and having a dedicated space helps. You're assuming they work less than half the time at home...
The IRS doesn't care about the "majority" except when it's "substantially all".
> ...and that it is strictly for their convenience and not the employers. Those were not my assumptions. If an employer offers work from home they obviously derive benefit from it (perhaps better retention rates or easier recruiting).
By that logic it's always for the employer's convenience and the question becomes pointless. I'm confident that's not the IRS's intent because then they wouldn't ask the question at all.
They confirm this with their Example 4, where Kathleen chooses to work from home and therefore does not meet the convenience-of-the-employer test. If your employer offers you the option, it's for your convenience.
> Like I said, there is clearly the opportunity to deduct this expense. There are obvious pitfalls that you pointed out.
Some people can take this deduction. It's pretty clear from the IRS's guidance that employees who telecommute part of the time cannot.
Interesting. What part of the document makes you think a part-time telecommuter can deduct their home office? The "Primary Place of Business" rules would seem to preclude that.
Either way, my initial response stands - check with your CPA.
> The relative importance of the activities performed at
each place where you conduct business, and
> The amount of time spent at each place where you
conduct business.
Part time can be 22 out of 40 hours. Or 30 out of 40. The next condition to satisfy is when do you set up meetings, appointments, whatever managerial tasks?
The opportunity exists for a part-time work from home worker to deduct the expense. In the tech industry working from home can be seen as a benefit to the employer because it may help their retention rate or help them recruit workers, plus lower office space costs by allowing them to share offices among many employees.
That's what I was implying by saying the opportunity exists.
That's not the only test. It must be exclusive use, but also must be for your employer's convenience (not your own) and more importantly it must be the only place that you perform significant administrative or management duties for the business. (There are other rules but these are the ones that exclude most part-time WFH arrangements.)
If you have an office at work, you're probably taking the deduction illegally.
