The lives of home office dwellers just got easier—and maybe cheaper.
The good news is that he Internal Revenue Service announced a new option on Tuesday for those who claim their home as their primary work space. The bad news is that won't apply to 2012; rather, the allowable expense method will begin for the 2013 tax year.
The deduction method is meant to simplify a confusing process, one that often leaves taxpayers facing an audit. Instead of working through the minutia of the seemingly endless Form 8829, taxpayers will have the option of deducting $5 per square foot for up to 300 square feet of office space, or $1,500.
The word "option" should be emphasized, since home office workers will still have the choice of using Form 8829 if that deduction is larger than the newly introduced alternative method. Individuals will weigh the time expense of filing out the old form against the difference in the size of the deduction.
