What's the Difference Between the Simplified and Regular Home Office Deduction Methods?

If you work from home and qualify for the home office deduction, you can calculate it using either the simplified method or the regular method. The simplified method lets you deduct $5 per square foot of your home office, up to 300 square feet, for a maximum deduction of $1,500 — no receipts needed, just the square footage. The regular method calculates the business-use percentage of your home (office square footage divided by total home square footage) and applies that percentage to your actual home expenses, including mortgage interest or rent, utilities, insurance, and depreciation. The regular method usually produces a larger deduction but requires more recordkeeping and introduces depreciation recapture when you sell your home. You can switch methods year to year, so it's worth calculating both to see which saves you more in any given year.