Can remote workers deduct home office expenses on taxes?

Remote work has reshaped how many people do their jobs, but it also raises a common tax question: which home office costs can actually be deducted?

The Tax Cuts and Jobs Act of 2017 narrowed deductions for W-2 employees while preserving tax breaks for self-employed workers. As a result, not every remote worker can claim an internet bill or home office setup as a write-off.

Understanding what qualifies, and how to document eligible costs, can help taxpayers avoid mistakes and get the most from their returns. Intuit TurboTax explains what remote workers may be able to deduct, how to keep records, and what to know before filing.

How remote work deductions work

Working from home can bring added expenses such as internet service, office supplies, and a dedicated workspace. Whether those costs are deductible depends on your employment status.

• Self-employed: You may be able to deduct qualifying home office expenses.
• W-2 employee: You are generally not eligible for home office deductions under federal tax law, including the Tax Cuts and Jobs Act and the One Big Beautiful Bill Act, which permanently disallowed most unreimbursed employee expenses.

State tax rules may differ. In some places, remote workers can still claim deductions even when federal law does not allow them. To stay compliant and make sure you are taking every deduction available, check your state’s rules or speak with a tax professional.

For self-employed workers

Freelancers, independent contractors, and other self-employed workers may qualify for home office deductions that W-2 employees cannot claim. To deduct these expenses, the workspace must be used both exclusively and regularly for business.

For instance, a dedicated office space qualifies, but a dining table that also serves as a work desk would not.

Deductible expenses can include:

• A share of rent or mortgage costs based on the size of the office, using either the simplified or actual expense method
• Utilities, internet, and office supplies used for business
• Business equipment such as computers, printers, and furniture

Self-employed taxpayers may also deduct up to $2.5 million in qualified business equipment under the Section 179 deduction for the 2025 tax year, and $2.56 million for the 2026 tax year. The deduction cannot be greater than net business income, though any unused amount can be carried forward to later years. Receipts, invoices, and other records should be retained, since the IRS requires proper documentation.

For W-2 employees

If you are a W-2 employee, you generally cannot deduct home office expenses on your federal return, even if you work remotely. That means costs such as internet service, office furniture, rent, or travel are typically not deductible, even when they are job-related.

There may still be a way to recover some of those costs. Some employers offer accountable plans, which allow tax-free reimbursement for certain business expenses. When an accountable plan meets IRS rules, employees can be repaid for necessary work-related costs without those payments counting as wages or being subject to withholding.

If your employer does not offer such a plan, you may have to absorb remote work expenses without tax relief.

Who qualifies for the home office deduction?

The home office deduction is generally available to self-employed individuals, freelancers, and independent contractors who satisfy IRS requirements.

To qualify, the space must:

• Be used exclusively for business: The area must be reserved for work and not personal use
• Be used regularly: The space must be used frequently, not just occasionally
• Serve as the principal place of business: It must be your main location for conducting business or meeting clients and customers

Because W-2 employees usually are not eligible for this deduction unless they run a separate business from home or live in a state that allows it, it is important to understand which expenses count and how to calculate the amount.

Monika Krulic, EA, notes that in states where miscellaneous itemized deductions are still allowed, including home office expenses in places such as California or New York, taxpayers can still report them on their federal return.

Ways to calculate the deduction

There are two main ways to figure the home office deduction:

• Simplified method: Deduct $5 per square foot of the office, up to 300 square feet, for a maximum deduction of $1,500. This approach requires minimal recordkeeping.
• Actual expenses method: Calculate the business portion of actual home costs based on the size of the office compared with the rest of the home. This can include mortgage interest or rent, utilities, internet, insurance, and home depreciation, but it requires more detailed records.

Self-employed taxpayers claim these deductions on Schedule C. If using the actual expenses method, IRS Form 8829, Expenses for Business Use of Your Home, must also be filed.

The better option depends on the size of your home office and how much documentation you are willing to maintain. It can be useful to calculate both methods and compare the results.

Expenses that may be deductible

If you qualify for the home office deduction, you may be able to write off several workspace-related costs. These generally fall into two categories:

• Direct expenses: Costs tied only to the home office, such as furniture, repairs, or improvements made solely to that space. These are fully deductible.
• Indirect expenses: Costs that apply to the entire home but can be partly allocated to the office, including rent, mortgage interest, utilities, and maintenance. These are deductible based on the business-use percentage of the home.

Examples of common deductions

• Mortgage interest or rent: A portion of these costs may be deducted according to how much of the home is used for business. For example, if the office takes up 10% of the home, 10% of these costs may be deducted.
• Utilities: Electricity, heating, water, and internet may be partially deductible based on business use.
• Homeowners or renters insurance: A percentage of premiums may be deducted.
• Depreciation: Homeowners may deduct a portion of depreciation tied to business use, though that amount may need to be recaptured when the home is sold.
• Repairs and maintenance: Office-specific repairs, such as fixing wiring in the work area, are fully deductible, while broader repairs, such as HVAC service, are only partly deductible.

The IRS expects detailed records, so receipts, bills, and calculations should be kept to support the deduction and ensure compliance.

Getting the most from remote work tax breaks

If you are self-employed, a freelancer, or an independent contractor and meet IRS requirements, you may be able to claim remote work deductions, but only if the home office is used exclusively and regularly for business. W-2 employees generally cannot deduct these costs unless they are reimbursed under an employer’s accountable plan or live in a state that permits the deduction on the state return.

Keeping careful records of expenses such as rent, utilities, and office supplies can help you maximize the deductions you are allowed to claim.