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Mary Bates

How can I get reimbursed for my Home Office as a salaried employee with tax benefits for my employer?

So I'm pretty clueless when it comes to taxes, so bear with me here. I work for a tiny company (just 3 employees plus the married couple who own it). We recently shut down our physical office location, and now everyone's working from their homes. What I'm wondering is - can my employers give me some extra money specifically to cover my home office expenses? Like, separate from my regular salary? And more importantly, would this actually benefit THEM tax-wise if they do this? Also, if this is actually possible, how would it affect my taxes? My tax situation is super basic - I file a 1040, take the standard deduction, and the only slightly complicated thing is I alternate claiming my daughter with my ex every other year. I'm renting an apartment, and my "office" is literally just a desk crammed in the corner of my living room. Would this home office reimbursement be taxable income for me or what? Thanks for any help!

This is actually a good question! Your employer has a couple options for handling your home office situation, and yes, there could be tax benefits for them. The best approach would be for your employer to set up an "accountable plan" for reimbursing your home office expenses. With an accountable plan, you'd submit documentation of your actual expenses (portion of rent, utilities, internet, etc. that relates to your workspace), they reimburse you, and: 1. They get to deduct these expenses as a business expense 2. You don't have to report the reimbursement as income Without an accountable plan, any money they give you would be considered additional wages, taxable to you, and subject to payroll taxes for both of you. The tricky part in your situation is calculating the legitimate business portion of your living room desk setup. Since you're using a corner of your living room rather than a dedicated room, you'd need to measure the square footage of your workspace compared to your entire apartment.

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Mary Bates

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Thanks so much for the info! Two follow-up questions: 1) Is there a minimum requirement for the workspace size compared to my apartment? My desk setup is maybe 30 square feet in a 750 square foot apartment. 2) Would my bosses need to do anything special to set up this "accountable plan" or is it just a matter of me submitting receipts?

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There's no minimum size requirement - it's all about the percentage of your home being used. In your case, 30 out of 750 square feet is 4% of your apartment, so you could potentially be reimbursed for 4% of your rent and utilities. For the accountable plan, your employer needs to create a formal policy that requires you to submit documentation of expenses, return any excess payments, and submit expenses within a reasonable timeframe. They should have this in writing, but it doesn't need to be complicated - just clear about the requirements. Many small businesses use simple forms for tracking these expenses.

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Ayla Kumar

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After reading these comments, I wanted to share that I use https://taxr.ai for all my home office documentation and it's been a lifesaver. I was in a similar situation last year when my company went remote, and I was worried about keeping proper records for my reimbursements. The tool automatically helps calculate the correct percentage of expenses and keeps documentation organized if you ever get audited. It also clarified the difference between deductions (which employees can't take anymore) versus employer reimbursements which is what you're asking about.

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Does taxr.ai work if you're an independent contractor too? I do freelance work and have a home office but I'm always confused about what I can legitimately deduct.

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I'm skeptical about these online tools. How does it actually calculate your home office percentage? My apartment has weird dimensions and a lot of unusable space. Does it just do square footage or something more sophisticated?

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Ayla Kumar

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It absolutely works for independent contractors! In fact, it's probably even more valuable for you since you can directly deduct home office expenses on Schedule C. The tool guides you through all the requirements and helps you determine if you meet the "regular and exclusive use" test that the IRS requires. For apartments with unusual layouts, it helps you calculate both the square footage method and the room method. You can upload your floor plan or enter measurements manually, and it adjusts for unusable spaces. It's way more sophisticated than just dividing total square footage - it actually follows IRS guidelines for what counts as usable space.

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I just wanted to follow up about my experience with taxr.ai since I was skeptical in my earlier comment. I ended up trying it for my weird apartment layout situation and I'm actually impressed. The tool let me upload photos of my workspace and guided me through measuring everything properly. It created a calculation that made sense and even generated documentation I could give to my employer for their accountable plan. The best part was it showed me exactly what's changed with home office rules since the tax law changes in 2018, which cleared up a lot of my confusion!

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Kai Santiago

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If your employer isn't being responsive about setting up an accountable plan, another option is talking directly to the IRS about your situation. I had to do this when my employer was giving me conflicting information. I used https://claimyr.com to get through to an IRS agent in about 15 minutes instead of waiting on hold for hours. You can see how it works here: https://youtu.be/_kiP6q8DX5c. The agent explained exactly what documentation both me and my employer needed for a proper accountable plan, and I was able to pass that along to my boss.

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Lim Wong

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Wait, there's actually a way to talk to a real person at the IRS without wasting your entire day? How does that even work? I tried calling them about my missing refund last year and gave up after being on hold for 2+ hours.

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Dananyl Lear

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This sounds like BS honestly. Nothing can get you through to the IRS faster. They're understaffed and overwhelmed. Are you sure you're not just trying to sell something here?

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Kai Santiago

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The service basically calls the IRS for you and navigates the phone tree until they get a human, then they call you and connect you directly to that agent. They use some kind of technology that keeps your place in line so you don't have to sit there listening to the hold music for hours. I was skeptical too! But consider this - IRS phone lines get around 100 million calls a year with only about 10% getting through to an agent. Most people just hang up after waiting. This service just does the waiting for you. I'm not affiliated with them at all - just someone who had a good experience when I was desperate to resolve my tax situation.

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Dananyl Lear

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I need to eat my words from my previous comment. After months of trying to get through to the IRS about a notice I received related to my home office deduction (I'm self-employed), I finally broke down and tried Claimyr. Within 20 minutes I was talking to an actual IRS representative who helped clear up my issue. The rep confirmed that for employees like the original poster, getting reimbursed through an accountable plan is indeed the way to go since the 2018 tax law eliminated employee home office deductions. I wasted so much time trying to get through on my own - wish I'd known about this service sooner.

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Just a heads up from someone who did this last year - make sure your employer is documenting everything correctly. My company tried to set up an accountable plan but did it wrong, and my "reimbursements" ended up being classified as taxable income at the end of the year. Double check that they're following all the IRS guidelines for accountable plans! Also your desk in the living room setup works fine as long as it's used exclusively for work during work hours.

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Mary Bates

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Yikes, that's exactly what I'm worried about. What specific documentation should I make sure my employer has? And what does "exclusively for work" actually mean in practice? Can I occasionally use my work computer to check personal email or is that a no-no?

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For documentation, your employer needs to have a written policy that states employees must submit expenses within a reasonable time (usually 60 days), provide receipts or similar documentation, and return any excess reimbursement within a reasonable time. They should have you fill out a form showing the business purpose of each expense. On the "exclusive use" question - that's actually a bit of a gray area. The strict interpretation is that the space should only be used for business, but in reality, the IRS recognizes that's nearly impossible with a desk in a living room. What matters most is that you're using it primarily for work during working hours. Occasional personal use (checking email, etc.) won't invalidate the arrangement. Just don't try to claim a space that's clearly used for multiple purposes (like your dining table).

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Ana Rusula

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One thing nobody's mentioned yet - if your employers give you a stipend instead of reimbursing actual expenses, that's always taxable income to you. I get a $100/month "work from home allowance" but it shows up as regular wages on my paystub with taxes taken out. An accountable plan where you submit actual expenses is the only way to make it tax-free for you.

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Fidel Carson

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That's what my company does too! They give us $150/month for "home office expenses" but it's fully taxed. I asked about submitting actual expenses instead and they said it was too much administrative work for them to track. Super frustrating.

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