Home Office Deduction Calculator

Do I actually qualify for the Home Office Deduction? (I'm worried I don't)

You probably do! The IRS says you qualify if you work from home "regularly and exclusively" in a dedicated space. Here's what that means in plain English:

✅ You QUALIFY if:

• You're self-employed, OR even if you have contractor income (1099, LLC, S-Corp, sole proprietor)
• You have a specific area in your home for business work (desk, corner of bedroom, spare room)
• You use that space ONLY for business (not your kitchen table where you also eat dinner)
• You work there regularly (doesn't have to be every day—a few hours a week or month counts)
• You perform your main work task there, OR you do the admin/managerial work for your business there (example: if you're an owner/operator trucker, and do monthly papwerwork there)

❌ You DON'T qualify if:

• You're a W-2 employee working from home (this deduction is only for self-employed folks, or people paid for work wihta 1099)
• You work at coffee shops/coworking spaces and never at home
• You use the space for both personal AND business (like your living room couch)

Real talk: If you have a desk you use for client work and nothing else, you qualify. Even if it's in your bedroom. Even if your "office" is small, like a closet or corner of a room.

Source: IRS Publication 587 - Business Use of Your Home

Will my accountant think this is legit?

Short answer: Yes. Your accountant will probably wish you'd brought this up sooner.

Here's the thing: Most accountants don't mention the home office deduction because gathering the data (square footage, assessed value, purchase date, etc.) takes time. It's not sketchy—it's just that hunting down old closing documents and property records is tedious, and many accountants would rather skip it than deal with the hassle.

That's exactly why we built this calculator. Enter your address, and we pull all the property data automatically from public tax records. Your accountant gets a clean PDF with the math already done. You just saved them an hour of work—they'll love you for it.

What your accountant needs from you:

• Office square footage (measure wall-to-wall using a tape measure)
• Total home square footage (we pull this for you automatically from public records)
• Property taxes paid (if you own your home - we pull this automatically for you from public records)
• Depreciation calculation data — This is the big one. Depreciation is often your BIGGEST single deduction ($1,500-$2,500+/year), but most people have no clue where to find the data needed to calculate it. We pull all the required info automtically from public records - your purchase date, purchase price, and building value, then calculate your depreciation deduction using IRS-compliant methods.
• Annual totals for each expense category (mortgage interest, utilities, etc.). This seems like a pain to get, but you can use Shoeboxed to make it easy, or tally up your totals from your utilities bills and other receipts. We provide a helpful spreadsheet/Google sheets template on our personalized estimate page.
• Confirmation that you use the space exclusively for business

That's it. No individual receipts. Just annual totals and the square footage.

The PDF this calculator generates has all the IRS citations and calculations your accountant needs. They'll verify the numbers, maybe adjust a few estimates, and file Form 8829 with your return.

Fun fact: Accountants love when clients bring organized, pre-calculated data. You'll look like the easiest client they have.

Simplified vs. Actual Expense Method—which should I use?

Simplified method:

• $5 per square foot (max 300 sq ft = $1,500 max deduction)
• Super easy, no receipts needed
• Best if: Your office is tiny OR your home expenses are low

Actual Expense Method:

• Deduct a percentage of your REAL home costs (mortgage interest, property taxes, utilities, repairs, depreciation)
• Requires annual expense totals (but not individual receipts)
• Best if: You own your home OR have significant home expenses

Real numbers: Most people save $1,500-$5,000 MORE per year using actual expenses vs. simplified.

The catch: You need annual totals for all your home expenses. That's where Shoeboxed makes it dead simple.

Getting your annual totals with Shoeboxed:

• Mortgage interest & property taxes: Forward your annual 1098 form from your lender (or snap a photo)
• Utilities (electric, gas, water): Forward monthly bills or upload your annual statement
• Home insurance: Forward your policy renewal or annual summary
• Internet: Forward monthly bills (we total them automatically)
• Repairs & home improvements: Snap photos of receipts, forward email confirmations, or mail in paper receipts
• Lawn care, snow removal, cleaning: Same—photo, email, or mail

We extract every detail (date, merchant, amount), categorize everything, and let you run reports by category. At tax time, download a clean report with annual totals for each expense category. Your accountant gets exactly what they need, and you've got IRS-compliant documentation stored for the recommended retention period.

Bottom line: If you're leaving $2,000+ on the table, spending 5 minutes a month forwarding bills is worth it.

Will this trigger an audit? (I'm scared)

Nope. This is one of the most common self-employed deductions.

The facts:

• About 18% of sole proprietors claim the home office deduction (IRS data, Tax Year 2020)
• That's 5+ million people filing this every year
• The overall individual audit rate is about 0.5% (IRS Data Book 2024)
• The home office deduction itself is not an audit trigger (Keeper Tax, FlyFin)

Why people think it's risky:

• In the 1990s, the IRS cracked down on abuse (people claiming their whole house)
• Today, it's completely normal if you follow the rules

What "good documentation" means:

• Measure your office space accurately
• Keep annual expense totals (Shoeboxed does this automatically)
• Use the space exclusively for business (don't claim your kitchen)

Real talk: If you qualify and have documentation, there's nothing to worry about. Millions of people do this every year without issues.

What if I didn't save receipts from earlier this year?

You can still benefit! Getting your expense totals isn't that hard.

Last Year's Taxes: Download and Total The Big Categories, We Take Care of The Rest

• Property taxes: We pull this information for you from public records
• Deprecation: We pull this information for you from public records and calculate this for you
• Home Square Footage: We pull this information for you from public records
• Heat: download your bills for last year and total them up, OR upload them into Shoeboxed and we'll do the work for you
• Electric: download your bills for last year and total them up, OR upload them into Shoeboxed and we'll do the work for you
• Water/Trash/Lawncare/Etc.: download your bills for last year and total them up, OR upload them into Shoeboxed and we'll do the work for you
• Other Home Repair/Maintenance Bills: download your bills for last year and total them up, OR upload them into Shoeboxed and we'll do the work for you. The rule here is that expenses that apply to the entire house (roof, etc.) apply, not things for a specific room in your house that is not your office.

This Year's Taxes: Sign up for Shoeboxed and let us do the work for you.

• Use this calculator to see what you COULD save on last year's taxes. It's free, and you can always compile all your receipts and total everything up yourself.
• Or - set up Shoeboxed now to make this year's Home Office Deduction a breeze, and track everything automatically for next tax season

The key: Don't let "I should have started sooner" stop you from saving money on taxes.

Is this estimate accurate?

It's based on real data, but your accountant will verify the numbers.

What we pull from public tax records:

• Your home's square footage
• Property tax amount (exact)
• Assessed home value
• Depreciation calculation data — This is huge. We automatically pull your home's purchase date, original purchase price, and building value from public records. Most people have NO IDEA where to find this stuff (it's buried in closing documents from years ago). Depreciation is often the BIGGEST single deduction in the actual expense method ($1,500-$2,500+/year), and we calculate it for you using IRS-compliant methods. You don't have to dig through old paperwork or remember what you paid—we handle it.

What we estimate (you'll confirm with your accountant):

• Mortgage interest (based on purchase price and typical rates)
• Utilities & other home expenses (based on state averages per square foot)
• Office size (you'll measure this accurately)

Think of this as a starting point. It shows you the potential savings and gives your accountant 90% of what they need. They'll fine-tune the numbers when they file.

Real talk: This estimate is accurate enough to print, bring to your accountant, and say "Can we claim this?" They'll love that you did the homework.