In the past, intricate forms have made it challenging to claim a home office deduction with the Internal revenue Service. The tax bureau was quick to scrutinize these claims for difficulties. However, that procedure will be much simpler when filing tax forms in 2014.
Home office deduction
The procedure of deducting a room as an office in a home is really complicated, according to the IRS. That is why the process will be made easier.
There were 3.4 million Americans in 2010 who deducted a home office on their taxes.
The tax code section 280A states that a taxpayer can only count the room as a deduction if it is: "The principal place of business of a trade or business, as a place where you meet with patients, clients, or consumers in the normal course of your business, or your work as an employee, but only if the use of the home office is for the convenience of your employer."
Once cumbersome process simplified
Taxpayers had to fill out the 43-line Form 8829 to determine what part of the home is really deducted for the business. This was really complicated and took a ton of work.
Working class individuals can take up to $1,500 in educations and $5 for every square foot of space for the deduction in 2014.
The Internal Revenue Service feels accomplished and like it has saved working class individuals millions of hours of complicated paperwork with the change.
Nice to know there is change
The National Association for the Self-Employed is pretty happy about the change, and so are others.
"This is terrific news for the 52 percent of all small business that work from home, who fight every day to meet their bottom lines while continuing to contribute to the economy," said Kristie Arslan, who heads the group. "The previous calculation for the deduction was cumbersome and time consuming for America's smallest business and year after year hard-earned dollars were left on the table."
The first returns to incorporate the change will be 2013 returns filed in 2014.
Home office deduction
The procedure of deducting a room as an office in a home is really complicated, according to the IRS. That is why the process will be made easier.
There were 3.4 million Americans in 2010 who deducted a home office on their taxes.
The tax code section 280A states that a taxpayer can only count the room as a deduction if it is: "The principal place of business of a trade or business, as a place where you meet with patients, clients, or consumers in the normal course of your business, or your work as an employee, but only if the use of the home office is for the convenience of your employer."
Once cumbersome process simplified
Taxpayers had to fill out the 43-line Form 8829 to determine what part of the home is really deducted for the business. This was really complicated and took a ton of work.
Working class individuals can take up to $1,500 in educations and $5 for every square foot of space for the deduction in 2014.
The Internal Revenue Service feels accomplished and like it has saved working class individuals millions of hours of complicated paperwork with the change.
Nice to know there is change
The National Association for the Self-Employed is pretty happy about the change, and so are others.
"This is terrific news for the 52 percent of all small business that work from home, who fight every day to meet their bottom lines while continuing to contribute to the economy," said Kristie Arslan, who heads the group. "The previous calculation for the deduction was cumbersome and time consuming for America's smallest business and year after year hard-earned dollars were left on the table."
The first returns to incorporate the change will be 2013 returns filed in 2014.