For 2023 tax filing, what home office write-offs/credits can I claim as a W-2 employee working from home?

So if I do some freelance work on the side, could I claim the home office for that portion? Like if 20% of my income is from freelance, can I deduct 20% of my home office costs?

Yes, if you have legitimate self-employment income, you could potentially claim a portion of your home office expenses relative to that business use. You would need to use the space "regularly and exclusively" for that business activity and calculate the percentage based on the square footage used for business relative to your total home. The percentage wouldn't be based on your income split, but rather on the actual space used. So if your home office is 200 square feet in a 1000 square foot apartment, you could potentially deduct 20% of your rent and utilities against your self-employment income. Just make sure to document everything carefully in case of an audit.

Does it actually handle the mixed employee/freelance situation well? My tax person seems confused about how to handle my split situation.

I'm kinda skeptical about AI tax tools. How accurate is it for complicated situations? And does it update with the latest tax law changes?

It handles mixed employment situations really well - that was exactly my case. I'm mostly W-2 but do some 1099 work, and it clearly separated what I could claim for each type of income. The tool showed me exactly what percentage of my home office expenses could be allocated to my freelance work. As for accuracy with tax law changes, they update their system constantly. When I used it in February, it had already incorporated all the 2023 tax year changes. It also explains the relevant tax codes and provides citations so you can verify everything yourself if you want. It saved me tons of research time.

Wait, how does this even work? I thought the IRS phone system was completely broken. Is this legit?

Sounds like a scam. No way they can get you through when the IRS itself says wait times are 60+ minutes. Probably just charges you and then puts you on the same hold everyone else deals with.

It works by using automated technology to navigate the IRS phone system for you. You register on their site, and their system calls the IRS and waits on hold instead of you. When it actually connects with an IRS agent, you get a call connecting you directly to that agent. No more waiting on hold! I was super skeptical too at first. I thought it might be some kind of scam, but it's completely legitimate. They don't pretend to be you or anything sketchy - they just handle the frustrating wait time part. When I used it, I got connected in about 35 minutes when I had previously waited over 2 hours and got disconnected. The IRS agent I spoke with was able to answer all my home office deduction questions.

How do you calculate the right percentage to claim? Is it based on income split, hours worked, or something else?

You calculate it based on the square footage of your office space divided by your total home square footage. So if your office is 100 square feet in a 1,000 square foot apartment, you'd get a 10% deduction of eligible expenses. It's not based on income or hours worked at all. The more complicated part is that you can only deduct expenses against your self-employment income. So if your freelance work only brings in $2,000 but your deductible home office expenses would be $3,000, you're limited to deducting $2,000. The calculation can get a bit tricky but most tax software walks you through it.

Seconding this. My company reimburses up to $750 for home office furniture and tech. They switched to this model instead of maintaining physical offices. Definitely worth asking your employer about!