Home Office IRS Forms
A collection of IRS forms related to the home office deduction. Find all of the information you need to file your small business taxes in this TaxBuzz Guide.
Self-employed taxpayers using the regular method to compute their home office deduction use Form 8829; self-employed taxpayers using the simplified method use a worksheet in the instructions to Schedule C (not Form 8829) and enter square footage information directly on Schedule C. Schedule F filers and partners that use a part of their home for business use a worksheet in Pub 587, and not Form 8829, to determine their home office deduction. Employees aren’t able to claim a home office deduction in years 2018 through 2025 due to the TCJA suspension of Tier 2 miscellaneous deductions.
In years when the miscellaneous itemized deductions aren’t suspended, an employee:
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• Reports the home office deduction on Schedule A (Tier 2 miscellaneous deductions) and can figure the deduction using a worksheet found in IRS Publication 587.
• Deducts both the business and nonbusiness parts of home mortgage interest, real property taxes and casualty (disaster) losses in their usual places on Schedule A and not as part of the home office deduction in miscellaneous deductions.
Claiming Standard Deduction & Regular Method Home Office Deduction
For taxpayers claiming the standard deduction and using the regular method for figuring a home office deduction, the mortgage interest, including eligible mortgage insurance premiums, and real property taxes are entered on Form 8829, lines 16 and 17, column (b), and not on lines 10 and 11.
SALT Limit and Form 8829
When computing the home office deduction on Form 8829 for 2018 through 2025, and the total of real property taxes and other state and local taxes exceeds the $10,000 SALT limit imposed by TCJA, the “Line 11 Worksheet” in the Form 8829 instructions is used to determine the amount of real property tax eligible to be deducted as part of the home office deduction and in which section of the form it is entered. In some situations, instead of entering the amount on line 11, column (b) (real estate taxes – indirect expenses) of the 8829, the entry goes on line 17, column (a) (excess real estate taxes – direct expenses), and the entry is already factored by the home office percentage.
There has been some confusion and concern about how the home office real property taxes are figured on the Form 8829, so to help clarify the process, we have cut the instruction verbiage down and rewrote it in clearer tax professional lingo. The way the form works is to allow a prorated amount of the interest (without the $1M/$750K limitations) and the prorated full amount of property tax (before the SALT limitation). However, it goes about it in a very convoluted manner that is hard to follow. Hopefully this will help.
Home Office Mortgage Interest
• If not itemizing
• Line 10 is to be blank (zero)
• Line 16, col. (b) includes ALL acquisition interest (including that which would otherwise be limited on Schedule A by the $1M/$750K).
• If itemizing
• Line 10, col. (b) is the amount that would be allowed on Schedule A if none were allocated to the business use of the home
• Line 16, col. (b) only includes the excess (difference between the total acquisition interest and the amount on Line 10)
| Form 8829 Line 11 Worksheet |
| 1. State & local income taxes or sales taxes |
| 2. Home real estate taxes |
| 3. Other nonbusiness real estate taxes |
| 4. Personal property tax |
| 5. Add lines 1 through 4 |
| 6. Multiple LN5 times business use % |
| 7. Subtract LN6 from LN5 |
| 8. Subtract LN7 from $10K/$5K (zero if neg) |
| 9. RE taxes to 8829 LN 11 – Smaller of LN6 or LN8 |
| 10. RE taxes to 8829 LN 17 – LN6 less LN9 |
Home Office Real Property Taxes
• If not itemizing
• Line 11 is blank (zero)
• Line 17, col. (b) - enter ALL the home’s property taxes.
• If itemizing
• Line 11
• If total state and local tax amount is $10,000 ($5,000 MFS) or less, enter the amount of the home’s property taxes on Line 11 col.(b).
• If total Sch A tax deduction would be limited because of the SALT limit, complete Line 11 worksheet and include WS Line 10 amount on Line 11, col, (a).
• Line 17
• If the Line 11 worksheet was completed, enter the amount from line 10 of the worksheet on Line 17(a).
• If the Line 11 worksheet was not used leave line 17 blank (zero).