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I work from home, what can I deduct on my taxes related to this?
AI accountant’s answer:
As a freelancer or 1099 contractor working from home, you may be eligible to deduct home office expenses on your tax return. To do this, you need to meet the following two requirements: 1. Regular and exclusive use: The space in your home must be used regularly and exclusively for your business. Exclusive use means that the space isn't used for personal activities, and it is dedicated only to your business. 2. Principal place of business: Your home office must be the main place where you conduct your business or a place where you regularly meet with clients or customers. If you meet these requirements, you can deduct home office expenses. There are two methods for calculating the home office deduction: 1. Simplified method: You're allowed to deduct $5 per square foot of the home office space, up to a maximum of 300 square feet, resulting in a maximum deduction of $1,500. 2. Regular method: With this method, you'll calculate the actual expenses related to your home office, like the percentage of your rent or mortgage interest, utilities, property taxes, maintenance, and other expenses. Besides the home office deduction, you can also deduct other business-related expenses, such as: - Office supplies and equipment - Internet and phone expenses (only the business portion) - Professional organization memberships and subscriptions - Business insurance premiums - Travel and mileage expenses for business purposes - Marketing and advertising costs Always keep detailed records and receipts for all your business expenses to support your deductions if needed.
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