TOOLS / FOR SELLERS

Home office deduction, both ways

The IRS lets you deduct a home office two ways. Plug in your numbers and see the simplified and regular methods side by side.

sq ft
The area used regularly and exclusively for work.
sq ft
Used to work out your office as a percentage of the home.
$
Rent or mortgage interest, utilities, insurance, repairs — the full-home totals.
$/ sq ft
IRS simplified rate is $5/sq ft, capped at 300 sq ft. Rates change — confirm the current figure.
SIMPLIFIED METHOD$—
REGULAR METHOD$—

Estimate only — not tax advice. Confirm with a licensed professional.

How this is calculated

The simplified method multiplies your office square footage (capped at 300 sq ft) by a flat rate — min(office sq ft, 300) × rate. No receipts, no depreciation, one number. Theregular method takes your office as a share of the whole home and applies that percentage to your actual home expenses — (office ÷ home) × annual expenses. It usually deducts more if your home costs are high, but it needs records and can complicate depreciation when you sell.

Which wins depends entirely on your numbers, and the rules shift year to year — this is a planning estimate, not a filing-ready figure. Read the basics infreelance taxes, explained, pair it with themileage deduction calculator if you drive for work, and when it's time to file, a tax advisor earns their fee here.