A post to an
email tax preparer group asked -
“Do you
guys think the Government will give all these work from home W2 workers a home
office deduction this year?”
My answer is NO.
Assuming that
the home office in question would qualify – taking into consideration the “exclusive
use” rule – why should it be allowed? It
does not cost an employee who temporarily works from home due to his "normal" office being closed anything to so do.
He, or she, does not incur any “out of pocket” expense – other than
perhaps a slight increase in the electric bill.
To be
perfectly honest, an employee forced to work at home is actually saving money –
i.e. no commuting costs, eating lunch at home every day, and perhaps reduced dry
cleaning bills for work clothing.
The
traditional home office deduction for a self-employed person – remember that
the home office deduction for an employee is an employee business expense and
employee business expenses are no longer deductible on Schedule A – applies a
percentage of all home expenses, including property taxes, acquisition debt
mortgage, homeowners insurance, utilities, security, and depreciation, based on
the size of the office.
These costs
for an employee forced to temporarily work at home, except perhaps utilities, do
not change or increase because he or she is working at home. The mortgage payment, the insurance premium, and the
home security bill are the same as they would be if the employee did not
work at home.
An employee
who works at home may incur additional costs for software or computer upgrades,
but these expenses can, and should, be reimbursed by the employer under an “accountable
plan”.
This is
obviously just my opinion on the issue.
It is possible that Congress will allow some kind of modified home
office deduction in certain situations, regardless of how stupid and unnecessary
it is. Congress has been known to do
stupid and unnecessary things in the past.
So, what do
you think?
TTFN
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