Calculate your home office deduction
Method comparison
Business-use percentage
Do you qualify for the home office deduction?
To claim a home office deduction, your workspace must meet two IRS requirements: it must be used regularly and exclusively for business, and it must be your principal place of business (or where you meet clients, or a separate structure).
Simplified method
The simplified method lets you deduct $5 per square foot of your dedicated workspace, up to a maximum of 300 square feet — so the maximum deduction is $1,500. It requires no calculation of actual home expenses and carries no depreciation recapture risk when you sell your home. Best for small offices or renters with modest home expenses.
Regular method
The regular method calculates your business-use percentage (office sq ft ÷ total home sq ft) and applies it to all actual home expenses: rent or mortgage interest, utilities, insurance, and repairs. This method typically produces a larger deduction for larger offices or expensive homes. However, if you own your home, it also involves depreciation — which can trigger depreciation recapture tax when you sell. Consult a tax professional if you own your home and are considering the regular method.
Which method should you choose?
Use this calculator to compare both methods at your actual numbers. The regular method almost always wins for larger offices (200+ sq ft) with significant home expenses. The simplified method wins when your office is small or your home is inexpensive. You can switch methods year to year — you're not locked in.