My Queue

There are no Videos in your queue.

Click on the Add to next to any video to save to your queue.

There are no Articles in your queue.

Click on the Add to next to any article to save to your queue.

There are no Podcasts in your queue.

Click on the Add to next to any podcast episode to save to your queue.

You're not following any authors.

Click the Follow button on any author page to keep up with the latest content from your favorite authors.


Taxing Matters

Come tax time, you'll be glad you decided to start your own homebased business.
Magazine Contributor
2 min read

This story appears in the November 2003 issue of Entrepreneur. Subscribe »

Q: Are there tax benefits from operating a homebased business?

Name withheld

A: Without question, operating your own business from home has several tax advantages. You can deduct a percentage of many home-related expenses based on how much of your home you can qualify for a home-office deduction.

For example, if you have a 2,000-square-foot home and a 200-square-foot office, you could deduct 10 percent of many expenses. Here are the most typical deductions:

  • A percentage of your rent if you rent or lease
  • A percentage of your mortgage interest if you're buying your home
  • A percentage of real estate taxes and homeowner association fees
  • Household supplies and cleaning services for the business portion of your home
  • Repair and maintenance of your home office
  • Utilities (electricity, gas, water) attributable to the business use of your home
  • Trash collection
  • Furniture in your household that you convert for use in the home office
  • Phone services, minus the base local service for the first line into your home (Lines devoted to the Internet and faxing may be entirely deductible.)
  • Business use of your automobile from the time you leave your door (If you had an office away from home, you would have a tough time deducting the cost of travel between your home and office.)

Taking all the deductions you're eligible for can offset the higher cost of health insurance you have to pay as a self-employed person. For more information, see IRS Publication 587, Business Use of Your Home.

Paul and Sarah Edwards are the co-authors of 15 books, including The Entrepreneurial Parent. Send them your start-up business questions at or in care of Entrepreneur.

More from Entrepreneur

Amina AlTai teaches entrepreneurs and intrapreneurs how to balance a thriving career, body and mind.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Are you paying too much for business insurance? Do you have critical gaps in your coverage? Trust Entrepreneur to help you find out.

Latest on Entrepreneur