Thank you for that correction. There was a time I knew that, only because the change was publicized at the time, but the change came too late to benefit me/my business and therefore didn't make a big impression on me. It would have been nice to have had what would have been the $500-ish/yr deduction for all the years it had been operating, mostly because - as you point out - of the additional capability to deduct commuting miles. But it wouldn't have been worth dealing with recapture and I would have had to do that at the time. There were other years when I couldn't have legitimately claimed space, despite operating the same business.Since 2013, the IRS has allowed the option of using the Simplified Home Office Deduction. You can deduct $5 per square foot up to 300 square feet. There is no depreciation so there is no recapture.... but consider the OP is struggling with estimated taxes, and given that would you really want to introduce home office expense recapture?
It's as simple as entering the square footage used for business and multiplying by $5. You enter that number on your Schedule C, line 30. The number cannot exceed your net business profit. It couldn't be easier.
And if you have the home office deduction, you should also consider your home as your principle place of business. It is where you store your brass before you take it to salvage. It is where you keep your business records and manage your business. With your home as principle place of business, you deduct all mileage from your home used to conduct your business. This travel deduction is often more valuable than the simplified home office deduction.
I'll correct my previous post; maybe the OP can comment on the amount of dedicated/exclusive space the business uses and how much the travel (mileage) would qualify as being primarily for business. Those details might or might not change my mind about operating as a business being worthwhile.
Statistics: Posted by tibbitts — Thu Jan 01, 2026 8:18 am — Replies 57 — Views 3305