In 2017, Congress removed the Home Office Deduction unless you are a business owner. See below for the excerpt, p 35, from The Wall Street Journal‘s 2021 Tax Guide. Available to WSJ+ Members at http://www.wsjplus.com/taxguide .
, Congress disallowed many miscellaneous deductions or imposed new limits on them. These changes generally expire at the end of 2025. As a result, employees can’t deduct home-office expenses for 2020—a benefit that might have been useful to millions of filers working at home during the pandemic. (Home-office deductions can still be taken by business owners.) However, employers can receive a tax benefit from reimbursing workers for a wide range of costs they incurred due to the pandemic. If a firm reimburses its staffers for, say, office equipment or faster internet they need for their work, the company can likely deduct the costs on its own tax return for 2020. Other miscellaneous deductions repealed until 2026 include write-offs for unreimbursed expenses for employee travel, meals, and entertainment; union dues; safe-deposit box fees; tax-preparation fees; and subscriptions, among others. Also suspended is the deduction for investment-advisory fees. This change affects investors who pay fees for advice based on a percentage of their assets, including many with tax-efficient separately managed accounts. It can also hit investors in hedge funds or other funds structured as partnerships, if they owe tax on profits before hefty fees are deducted. Under prior law, many taxpayers found the miscellaneous-expenses deduction hard to qualify for, because total eligible expenses had to exceed 2% of adjusted gross income. Also on Schedule A, lawmakers curtailed the deduction for most casualty and theft losses other than from federally declared disasters. Some other itemized deductions are still allowed, such as for certain gambling losses. They are listed in the instructions for Schedule A. Elsewhere on the return, Congress ended the deduction for moving expenses by taxpayers who aren’t in the military. However, educators can still deduct up to $250 of unreimbursed expenses for classroom supplies, even if they don’t itemize on Schedule A. OTHER DEDUCTIONS, SUCH AS FOR HOME OFFICES Taxpayers can’t deduct a range of expenses that were once allowed, such as a home office used by an employee working remotely during the pandemic 36.
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Update to a few thoughts
In 2017, Congress removed the Home Office Deduction unless you are a business owner. See below for the excerpt, p 35, from The Wall Street Journal‘s 2021 Tax Guide. Available to WSJ+ Members at http://www.wsjplus.com/taxguide .
, Congress disallowed many miscellaneous deductions or imposed new limits on them. These changes generally expire at the end of 2025. As a result, employees can’t deduct home-office expenses for 2020—a benefit that might have been useful to millions of filers working at home during the pandemic. (Home-office deductions can still be taken by business owners.) However, employers can receive a tax benefit from reimbursing workers for a wide range of costs they incurred due to the pandemic. If a firm reimburses its staffers for, say, office equipment or faster internet they need for their work, the company can likely deduct the costs on its own tax return for 2020. Other miscellaneous deductions repealed until 2026 include write-offs for unreimbursed expenses for employee travel, meals, and entertainment; union dues; safe-deposit box fees; tax-preparation fees; and subscriptions, among others. Also suspended is the deduction for investment-advisory fees. This change affects investors who pay fees for advice based on a percentage of their assets, including many with tax-efficient separately managed accounts. It can also hit investors in hedge funds or other funds structured as partnerships, if they owe tax on profits before hefty fees are deducted. Under prior law, many taxpayers found the miscellaneous-expenses deduction hard to qualify for, because total eligible expenses had to exceed 2% of adjusted gross income. Also on Schedule A, lawmakers curtailed the deduction for most casualty and theft losses other than from federally declared disasters. Some other itemized deductions are still allowed, such as for certain gambling losses. They are listed in the instructions for Schedule A. Elsewhere on the return, Congress ended the deduction for moving expenses by taxpayers who aren’t in the military. However, educators can still deduct up to $250 of unreimbursed expenses for classroom supplies, even if they don’t itemize on Schedule A. OTHER DEDUCTIONS, SUCH AS FOR HOME OFFICES Taxpayers can’t deduct a range of expenses that were once allowed, such as a home office used by an employee working remotely during the pandemic 36.
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