10 IRS Rules for the Home Office Deduction

Simplified Deduction
A simple deduction for simple spaces: You can use a flat formula to figure out how much to deduct. niolox/iStockphoto/ThinkStock

When choosing between two tax options, it seems like a no-brainer to go with the option designated as "simplified." In 2013, the IRS decided the actual expense option (which we were just discussing on previous pages) was a pretty difficult way to deduct home office expenses. Kindly, they offered a simpler way.

The simplified deduction for home offices is a heck of a lot easier to claim. Instead of having to take pen to paper and try to get an accurate number for the percentage of your house -- and all the expenses -- used by your business, they decided to create an option that doesn't require as much math. In the simplified method, you simply claim $5 per square foot of your home office, up to $1,500. Using the simplified method, you don't have to figure out percentages of specific bills: Just take the square footage, multiply it by five, and you have your deduction.