top of page

I've been working from home due to COVID-19, am I able to deduct home expenses?

​

A growing number of people now work from home – whether they started their own business, do freelance work on the side or work remotely for an employer because of the COVID-19. 

​

For employees, no you cannot deduct home expenses. Since the Tax Cuts and Jobs Act eliminated the unreimbursed employee business expense deductions starting in the 2018 tax year, which was one of several miscellaneous itemized deductions that was deductible above 2% of their adjusted gross income, employees who worked remotely can no longer deduct expenses from an eligible home office. 

 

However, self-employed individuals can still deduct their home office expenses from their business income – which isn't subject to a 2% threshold. But of course, this is only if they qualify. 

​

If you are self-employed and would like to learn more about deducting home expenses, click here.

Anchor 1

If married, should I file jointly or separately?

​

Married couples have an option to file jointly or separately on their federal income tax returns. The IRS strongly encourages most couples to file joint tax returns by extending various tax breaks to those who choose to file together. In most cases, the better option for married couples is to file jointly, but there may be few cases when it's better to file separate returns.

​

Advantages to filing jointly

  1. Married couples who file together can often times qualify for tax credits such as:

    • Earned Income Tax Credit

    • American Opportunity and Lifetime Learning Education Tax Credits

    • Exclusion or credit for adoption expenses

    • Child and Dependent Care Tax Credit

  2. Joint filers usually receive higher income thresholds for certain taxes and deductions. Because they have higher income thresholds, they can potentially qualify for certain tax breaks.

  3. Married couples who file separately, on the other hand, receive few tax considerations.

    • Filing separate tax returns may give you a higher tax with a higher tax rate.

    • Also, the standard deduction for separate filers is much lower than those who are joint filers. In 2023, married filing separately taxpayers only receive a standard deduction of $13,850 compared to the $27,700 offered to those who filed jointly.

  4. Separate filers are usually limited to a smaller IRA contribution deduction.

  5. Separate filers can't take the deduction for student loan interest.

  6. The capital loss deduction is limited to $1,500 each when filing separately, instead of $3,000 on a joint return.

​

Advantages to filing separately

This is a rare occurrence, but this is a situation where it can be more beneficial to file separately:

  1. If you or your spouse has a large amount of out-of-pocket medical expenses to claim during the year and since the IRS only allows you to deduct the amount of these costs that exceeds 7.5% of your adjusted gross income (AGI) in 2023, it can be very challenging to claim most of your expenses if you and your spouse have a high AGI. In this case, the more you make, the less chance you'll be able to deduct the medical expenses.

    • For example, if you have $7,000 in medical expenses and have an AGI of $60,000. That would meet the 7.5% threshold ($7,000 ÷ $60,000 = 11.7% of your income). Whereas, if together you make $150,000, this would disqualify you from claiming these medical expenses ($7,000 ÷ $150,000 = 4.7% of your AGI).

 

In conclusion, the best way to find out if you should file jointly or separately with your spouse is to prepare the tax return both ways. Make sure you are including the correct numbers in your calculation then look at the refund or balance due from each method. 

Anchor 2

When can I expect to receive my refund?

​

Go to our tax resources page, and access the IRS and Michigan refund status page. 

Anchor 3

Is there a way I can determine if I'll get a refund?

​

Click here to access a great calculator in figuring out your estimated taxes, and seeing if you may receive a refund for your 2023 tax return. Using this calculator will also help you fill out your W-4 form. 

Anchor 4

Do I need to file a tax return?

​

There are instances where you may not be required to file a tax return. Situations occurring for you not to file a tax return may include you not meeting the minimum income requirements. However, just because you don't meet the minimum income requirements, that doesn't mean you don't have to file a tax return -- you still may be required to file a return. But even if you aren't required, you still may be missing out on a refund if you don't file. 

​

Click here to read more details concerning the requirements in filing a tax return.

Anchor 5

Where can I access IRS forms?

​

Go to our tax resources page, and access IRS forms and publications.

Anchor 6
bottom of page