7 Home Office Deductions You Can Write Off as a Content Creator

The home office deduction has a bad reputation. Some people say it’s too hard (and there is a way to deal with that; we’ll get into it in a bit). Some people say it can flag your taxes for audit. But as a content creator, if you’re using a portion of your home exclusively for your business, then the home office deduction is an essential tax deduction to help you ensure that you are not paying too much in taxes.

Exclusivity Is the Key

Before we go into the details of how to deduct your home office expenses and what is deductible, we do want to stress that the area you consider your home office must be used exclusively for your content creation business for you to take the home office deduction. Your home office must also be the primary place you do business. If you rent office or studio space on a permanent or intermittent basis, your home office must still be the main place you work to be eligible for the deduction.

What the Home Office Deduction Includes

In general, these items are likely to be deductible under the home office deduction:

1. Housing Payments. The portion of your mortgage interest or rent payments that apply to your home office can be deducted.  
2. Internet Connection. This can be a percentage of your internet subscription or the full cost of a dedicated subscription. And if you’re doing live streaming and gaming, a dedicated business internet connection may be crucial for your success.
3. Phone Service. Again, this can be either a percentage of your general phone service or a dedicated business phone — either a landline or cell phone. Keeping separate lines for business and personal can make it much easier to calculate the deduction, but it may be unnecessary for your business.
4. Office Equipment. This includes your desk, chair(s), and other equipment. It may also include artwork and decorations.
5. Repairs and Maintenance. Any upgrades or repairs you do in the office area would qualify here.
6. Utilities. This deduction is most likely to be taken as a percentage of your overall utility bills.
7. Insurance. Homeowner’s or renter’s insurance would be a deduction under your home office deduction. Other types of insurance would be deducted in other areas of your tax forms.

You may have figured this out by what we included in this list, but both renters and homeowners can deduct home office expenses.

How to Calculate Your Home Office Deduction

The first step is to figure out how much of your home is used for your office space. Measure the space and see what percentage of your entire home or apartment that square footage is. For example, if your home is 1,800 square feet, and your office is 300 square feet, then your home office is 16.67% of your home.

Use your percentage to calculate the portion of your mortgage interest and property taxes or rent, utilities, homeowner’s or renter’s insurance, and repairs that are eligible to deduct. Mortgage principal is not eligible for the deduction.

Then figure the costs of other items that are fully deductible for your home office, such as equipment purchased during that year and dedicated internet and phone service.

For shared internet and phone service, you can keep logs of how many hours you use each for business and personal use. Then calculate the percentage that is business use and deduct that from the amount of your internet and phone bills that apply to you. For example, if you live by yourself and use your phone and internet for 50% business use, then you would deduct 50% of your total phone and internet bills. But if you share your service with a roommate, spouse, or family member, then you would take the portion of the bill that is yours and multiply that by your percentage.

Choosing a Simpler Way

If gathering this information and doing the math seems like too much of a hassle, then you can use the simplified home office deduction. You can deduct $5 per square foot up to 300 square feet. That gives you a total home office deduction of up to $1,500, unless that exceeds your gross income.

This simplified option saves a lot of time and effort, but you could be leaving money on the table if you think your home office deduction may exceed $1,500.

Want some help navigating this or other tax issues specific to content creators? Let’s talk — book a call to see how we can work together to take some of the bookkeeping and accounting tasks off your plate.