Home Office Deduction with 1997 Tax Act

Home Office Deduction with 1997 Tax Act

Old tax law regarding home office deduction

New, improved tax law

Old tax law regarding home office deduction

You could only deduct a home office if

The home office was the principal place of work

The home office was used exclusively and regularly for work

These requirements meant most could not claim the home office deduction

A traveling salesperson probably could not deduct a home office because the customer's site constituted the "principal place of work"

New, improved tax law

Now you can deduct your home office if it is used for substantial administrative or management activities and there is no other fixed location for such activities available

Home office still must be used exclusively and regularly as a home office

New law effective beginning in 1999