Thanks to Senator Olympia Snowe of Maine, there is a movement in Congress to establish an optional home office deduction for small business owners. According to the SBA, even though 53% of small businesses are home-based, few owners take the home office deduction due to its complexity and strict requirements. The Home Office Tax Deduction Simplification and Improvement Act of 2009 would establish a straight-forward, standard deduction that could be used instead.
Perhaps the best part of the Act is that it eases the burden of proof in claiming the deduction. If your business is “virtual” like mine and you don’t actually meet clients in your home office, the legislation will allow you to take the deduction regardless of whether your clients are physically present in your office. Also, making the occasional personal call or paying personal bills at your desk would no longer disqualify you from the deduction.
Finally, our tax laws are starting to catch up with how we actually live our lives!
Deb Howard Greenleaf, EA, CEO and Principal, of Greenleaf Accounting Services provides virtual accounting and bookkeeping services and specializes in financial management to consultants, coaches, solo professionals, and other small business owners across the US. Deb is an Enrolled Agent (EA)—an IRS-licensed tax professional—and specializes in small businesses and entrepreneurs filing Schedule C or as an LLC. As an Advanced Certified QuickBooks ProAdvisor, Deb spends her day in QuickBooks Online and specializes in providing QBO support.
