Make Your Home Office Less Taxing

Make Your Home Office Less Taxing

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More and more people are making the switch to working from home either because they are spreading their wings to start their own business or have decided that working from home is a better fit for them. However, working at home isn’t for everyone. There are pros and cons to setting up a home office.

The Good, the Bad, and the Just Plain Ugly
There are so many benefits to working from home! You can make your own hours, be your own boss, spend more time in your pajamas, thwart frustrating traffic, blast your favorite music and spend more time with your family. You can even save the money you would have been spending on gas and save it for a vacation! However, even with all these perks, there have to be a few drawbacks.

Having your office at home requires self-discipline. If you are the type of person who cannot focus without a manager breathing down your neck, working from home isn’t right for you. And if you’re an all-day snacker, taking your office home with you might be the worst thing for your waistline. Here are some tips to set up your home office for success!:
 

      

  • Stick to a budget. Don’t over spend on fancy furniture. Start with the basics and reward yourself with new digs as you build your business. The West Chester-based IKEA has fashionable, but frugal furniture, so you might want to start your search there.
  • Do yourself a favor and decorate your workspace to match your brand — especially if you will be entertaining clients in it. Express your personality, but keep it professional.
  • Don’t box yourself into a small office with no windows to the outside world. You’ll just feel like you’re in a cage and your productivity will fall. Put your desk in a place with some natural sunlight and add a plant or two brighten up the room and supply some fresh oxygen.
  • Keep your office away from high-traffic areas and the kitchen. It will help you stay focused and out of the food.
  • Make sure you ergonomically design your office. Having a slightly reclined chair will help ease back pain, making sure your monitor is between 24 and 36 inches away from your eyes will help you see and keeping your feet on a foot rest or flat on the floor will also help your comfort. For more tips on setting up an ergonomic office, check out Safecomputingtips.com.
  • As long as you don’t have clients coming in, play your favorite band loud and proud! Rock out to your iTunes, look for radio stations online, or subscribe to an online music service. Project Playlist or Pandora Radio are great ways to build a free playlist on your computer.
  • Keep it clean! Spend just a few minutes at the beginning or end of each day to straighten up your workspace, and set aside time each week to do mundane tasks like billing and filing. If you have the cash to spare, consider outsourcing or hiring a virtual assistant.0208GIBBERMAN.gif

 

Wait! Even More Benefits!
Looking for a way to keep Uncle Sam from taking so much of your income? Having a home office also gives you some tax breaks! Of course, there are rules. Your office must be used “regularly and exclusively,” meaning you must have a set space that you conduct all or almost all of your business in, that that will be all the space is used for. Putting a computer in your den or using your laptop in the kitchen doesn’t count. It also must be where you meet with patients, clients or customers. A separate or detached structure like a guesthouse can count as a home office, but if you sell your house you will be stuck paying more taxes on it.

Generally, if you are just working from home for you or your employer’s convenience it doesn’t count for tax breaks. However, if your employer doesn’t offer workspace at its location, you probably qualify. You can ask your tax professional if you are unclear about if your home office qualifies or not.

So how many tax breaks can you get from having a home office? Let me count the ways!

1. Home depreciaition
2. Home mortgate interest
3. Real estate taxes
4. Home insurance
5. Utilities
6. Wages for domestic help
7. Local phone service (excluding basic service)

 

On top of these special deductions, everyone qualifies for “ordinary and necessary” tax deductions:
 

  • Professional services such as accounting, attorney and consulting services
  • Logistical support such as alarm system, cleaning, office supplies, postage, shipping, printing, repairs and maintenance
  • Car
  • Office equipment such as computers
  • Traveling
  • Entertainment
  • Retirement
  • Marketing
  • Insurance
  • Payroll Taxes


For more information about what tax breaks you qualify for, ask your tax professional or view more information online at the IRS Web site.

 

 

PHOTO CREDITS:
Photo: Neysa Ruhl Photography
Location: Gateway Quarter
Model: Angi Bushelman, .mtm. John Casablancas
Makeup Artistry: Jocelyn Sparks, Zoë Custom Cosmetics

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