The COVID-19 pandemic changed everything about the world as we knew it. From travel restrictions to face mask requirements, we’ve had to adjust our lives in countless ways.
Many workplaces around the United States closed once coronavirus became part of our everyday vocabulary. That resulted in many people shifting from working in an office to working from home.
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While some employers have helped offset the costs of working from home, many have not.
Instead, the costs have been placed upon the employee.
For years, you could deduct job-related expenses on your tax return. However, the Tax Cuts and Jobs Act of 2017 increased the standard deduction and removed many of the deductible expense options.
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Eric Bronnenkant, head of tax at Betterment, explained it in simple terms.
“The only way to take a home office deduction or any other deductions for expenses incurred while working at home is if you’re self-employed.”
Luckily, though, you may be able to take a tax deduction for the costs of setting up your home office if you are a W-2 employee and your employer hasn’t paid for the costs.
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You will have to complete this through your state tax return, not your federal one.
Several states allow for this, including California, New York, Minnesota, and Arkansas.
Take the time to check your state’s rule!
A few search terms that could yield helpful results include “state name + work from home deduction” or “State name + itemized deductions.”
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Keep in mind that if you take the state deduction for work from home expenses, you are trading in the standard deduction for itemization.
So if you’re working from home during the pandemic, make sure to save all your receipts. They could be your ticket to getting back some cash next year.
Have you been forced to work from home during the pandemic? Have you ever worked from home before? Tell us about your experience in the comments below!
