Howdy @kc6498,
You mentioned you have a dedicated room for work. Which is essential for claiming the actual cost method.
Calculating 20% of your monthly rent, gas, water, internet, and electricity costs based on the size of your workroom relative to the total area of your house is a reasonable approach. This method is used to apportion expenses between work and personal use.
Make sure you include only the eligible expenses such as:
- Rent
- Electricity and gas (heating, cooling, lighting)
- Internet and phone usage
- Depreciation of office furniture and equipment
Keep detailed records of your expenses and how you calculated the work-related portion. This includes receipts, bills, and a log of your work hours.
The significant difference is expected. As the Actual Cost method often results in higher deductions if you have substantial work-related expenses.
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