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What is a Home Office?

People work out of their homes more an more as telecommuting and remote work becomes easier to manage and more affordable for some companies.

Some people use the term “home office” to loosely refer to the fact that they work primarily from their home, while other people have an actual office space in their home which is used solely for business purposes. In the latter case, someone can apply for a home office expense deduction on their taxes.

A home office is a term most commonly used for the workspace that is used by self-employed, contracting, or telecommuting individuals to perform business tasks within their residence. It can also be used within a company to refer to the corporate headquarters, when there are many other regional offices for different departments and so on.

Many individuals work from home today, and some of them work for large corporations; in such cases, a person could have two “home offices.” People that work from home and use a specific space exclusively for work are probably eligible for a home office expenses deduction on their taxes.

The deduction is computed using a formula that considers the percentage of the total square footage of the home that is dedicated workspace. Remote workers are sometimes referred to as telecommuters.

Technology has made it easier and easier for business associates to communicate through richer and richer communications channels, and for people to operate in a paperless or self-sufficient office with only one computer.

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