Working From Home

 In Tax

How will working from home affect my income taxes?

Many people have been working from home due to Covid-19.  To understand how this effects your tax situation, we first need to identify how you are compensated.  Are you an employee who receives a W-2, or are you self-employed/business owner?

If you are a W-2 employee, then as of tax year 2018, you are no longer allowed to deduct unreimbursed business expenses from your income taxes.  The best thing to do is to reach out to your employer and see if they are willing to reimburse you for the business-related expenses that you incur.  If they will, then the money that you receive for reimbursed expenses is not taxable.

If you are self-employed/business owner, then you can likely deduct your home office expenses. You will need to keep receipts and records showing that the expenses were work-related.  If you have an area of your home that you use regularly and exclusively as a work area, then you may also be able to qualify for a home office deduction.

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