Home Office Deductions

IRS reminds taxpayers of the home office deduction rules during Small Business Week

 

IR-2020-220, September 23, 2020

WASHINGTON — During Small Business Week, September 22-24, the Internal Revenue Service wants individuals to consider taking the home office deduction if they qualify. The benefit may allow taxpayers working from home to deduct certain expenses on their tax return.

The home office deduction is available to qualifying self-employed taxpayers, independent contractors and those working in the gig economy. However, the Tax Cuts and Jobs Act suspended the business use of home deduction from 2018 through 2025 for employees. Employees who receive a paycheck or a W-2 exclusively from an employer are not eligible for the deduction, even if they are currently working from home.

Child Tax Credit 2020

CHILD TAX CREDIT

IRS Tax Tip 2020-28, March 2, 2020

Taxpayers may be able to claim the child tax credit if they have a qualifying child under the age of 17. Part of this credit can be refundable, so it may give a taxpayer a refund even if they don't owe any tax.

The taxpayer's qualifying child must have a Social Security number issued by the Social Security Administration before the due date of their tax return, including extensions.

A dependent who doesn't have the required SSN may be eligible to be claimed for the credit for other dependents.

Here are some numbers to know before claiming the child tax credit or the credit for other dependents.

  • $2,000: The maximum amount of the child tax credit per qualifying child.
     
  • $1,400: The maximum amount of the child tax credit per qualifying child that can be refunded even if the taxpayer owes no tax.
     
  • $500: The maximum amount of the credit for other dependents for each qualifying dependent who isn't eligible to be claimed for the child tax credit. This can include dependents over the age of 16 and dependents who don't have the required SSN.
     
  • $400,000: The amount of adjusted gross income for taxpayers who are married taxpayers filing a joint return before the credit is reduced.
     

$200,000: The amount of adjusted gross income for all other taxpayers before the credit is reduced.