The Laws on tax cuts and employment The 2018 edition brought several changes to independent users in their Tax deductions.
These changes will be ebreathe in 2025, while others could be permanent.
Owners of sole proprietorships, S corporations, specific trusts, estates, limited liability companies (LLCs) and partnerships benefit from the TCJA.
Eligible taxpayers can deduct up to 20% of their QBI.
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You can deduct the the costs of your workspace. It doesn’t matter if you are a renter or a homeowner, there are many expenses you can deduct as home office expenses.
However, be prepared in the event of IRS audit. According to Amy Fontinelle, personal financial at Investopedia, it’s easy to prepare against an IRS audit.
“Prepare a diagram of your workspace, with precise measurements, if you must submit this information to justify your inference, which uses your workspace area in its calculation.
Knowing your precise workspace has more advantages in your tax deductions.
You can deduct mortgage interest, home depreciation, utilities, home insurance, and repairs.
“If your home office takes up 15% of your home, for example, then 15% of your annual electricity bill becomes tax deductible, ”said Amy Fontinelle.
Mortgage interest and home amortization applies to people who own a home office, rents do not apply.