There are 2 ways to calculate a home office deduction: the simplified method and actual expenses method. We don't make you choose; we leave it open so you can determine the most advantageous deduction each year for your annual taxes.
For estimating your quarterly tax payments though, we use the simplified method. We also use this simplified number for calculating your business profit and deductions, and in your Tax Summary and Tax Details reports. This means we exclude actual expenses from all our calculations because we don't want to double count for this deduction.
If you're eligible for a home office deduction, be sure to select its size on the Annual Taxes page.
- Click Taxes > Annual Taxes in the navigation menu.
- Click to open the Home Office section.
- Select the office size that most closely matches the square footage of your home office.
A deduction amount ($500 to $1500) then appears in the Deduction column.
For annual taxes, it's a good idea to categorize expenses for your home into our special home office categories. That way, at annual tax time, you'll have the totals needed for TurboTax or your tax pro so they can help you choose the biggest deduction.
Be sure to review the home office categories we offer so you don't overlook expenses that could increase your deduction in your annual tax return.