Home Office Deduction Calculator (Simplified vs Actual)

How to do it

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   Step 1: Open Home Office Deduction Calculator (Simplified vs Actual) and add your input

   Type your numbers or text, add your file, or pick the options you need. Nothing is uploaded: everything stays in your browser.

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   Step 2: What Home Office Deduction Calculator (Simplified vs Actual) does

   Compare the simplified $5 per square foot method with the actual-expense home office deduction.

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   Step 3: Read the result and compare

   The result appears at once. Change one value to see how the answer moves, then keep the figure that fits your case.

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   Step 4: Copy or save it

   Copy the result or download it. For an important decision, confirm it with the official source or an adviser.

About this tool

Enter the size of your office, the size of your home, your yearly home costs and depreciation, and your business income. The calculator works out both methods and shows which gives the larger deduction and the tax it saves.

Simplified method

$5 per square foot of office space, up to 300 square feet, so at most $1,500. No depreciation is claimed and there is no records burden beyond the size of the space.

Regular method

The office share of the home is the office area divided by the home area. That share of rent or mortgage interest, utilities, insurance, repairs and depreciation is deductible, limited to the business income left after other expenses. If you own the home, depreciation lowers the basis and is recaptured when you sell.

Who can claim

The space must be used regularly and exclusively for business. Employees cannot claim it; it is for self-employed people. The saving shown includes income tax at the rate you enter and self-employment tax of about 14.1% of the deduction.

Worked example

A 150 sq ft office in an 1,800 sq ft home is 8.3% of the home. With $28,000 of yearly costs and $6,000 of depreciation, the regular method gives $2,833 against $750 simplified. At 22% income tax plus self-employment tax the deduction saves about $1,023.

Tips for best results

Check every box before you rely on a result, because one wrong digit changes the whole answer. Use the exact figures from your payslip, bill, certificate or contract, and keep a note of the date you calculated. Rates, thresholds and rules change from time to time, so for tax, fees and legal matters treat the output as an estimate and confirm with the official source named on this page. You can run as many scenarios as you like; nothing is saved or sent, and refreshing the page clears the boxes.