What Is IRS Form 8829?

Man seated at a desk with laptop calculating business expenses
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Definition

IRS Form 8829 is a tax document you can use to claim a tax break for your home-based business. If you work or run your business from home, the Internal Revenue Service (IRS) allows you to take a partial tax deduction for business purposes for the expenses associated with maintaining your home.

Key Takeaways

  • IRS Form 8829 is used by self-employed taxpayers and small business owners who maintain a workspace in their homes to calculate their home office deduction.
  • The form calculates the portion of expenses related to your home that you can claim as a tax deduction on Schedule C.
  • Your work area must be dedicated entirely to doing business—it can’t do double duty as a personal living space.
  • The IRS offers a simplified version of the home office deduction that doesn't require completing or filing Form 8829, but using it can work out to less than the actual deduction you're entitled to claim.

How IRS Form 8829 Works

IRS Form 8829 walks you through the calculations for determining which expenses you can claim for the business use of your home and the percentage of those expenses you can claim. You'll put the total on your Schedule C and submit the schedule, along with Form 8829, with your tax return.

IRS Form 8829 (2022)
IRS Form 8829 (2022).

The Balance

Who Uses IRS Form 8829?

Self-employed taxpayers and small business owners can use Form 8829 to claim the home office deduction if they meet two criteria.

  • Your workspace must be the "principal place of your business," according to the IRS. You run your operation from there, though you can leave to perform the work your business offers.
  • Your workspace cannot be used for anything other than that—running and managing your business. The space you claim for a deduction can't do double-duty as a bedroom or a family room. You can use a portion or corner of a room as a home office as long as you exclusively dedicate that area.

Note

The rule about using your work area exclusively for business purposes doesn't apply to daycare businesses.

Where To Get Form 8829

IRS Form 8829 is available on the IRS website. You can complete it online and print it out, or you can download a copy. The self-employed versions of most tax preparation software will also complete the form for you, as well as your Schedule C.

How To Fill Out Form 8829

Form 8829 consists of four parts: Part I, Part II, Part III, and Part IV.

Part I

Part I of Form 8829 calculates the percentage of your home that's dedicated to your work. It asks you to describe the part of your home that you use.

Determine the square footage of the area you use for business, then divide that by the total square footage of your home to arrive at a percentage.

For example, your home business would take up 10% of your total home area if your workspace is 200 square feet and the total area of your home is 2,000 square feet.

Part II of Form 8829 calculates the deduction of your home expenses. First, enter the tentative profit from Line 29 of Schedule C, then enter:

  • Direct expenses, such as rent and utilities
  • Indirect expenses for casualty losses, deductible mortgage interest, and real estate taxes if you own your home

Multiply the total by the percentage of your home devoted to your business on Line 7.

Part II

You can then deduct:

  • Excess mortgage interest
  • Insurance costs
  • Rent
  • Repairs and maintenance
  • Utilities
  • Other expenses

Part III

You'll use Part III to calculate depreciation on your home so it can be allocated to your home business according to the percentage on Line 7. The total amount of depreciation is entered on Line 30.

Note

Part III is complicated; you might need the help of a tax professional if it applies to you. It deals with deductions carried over from the previous year, excess casualty losses, and depreciation.

Part IV

Part IV applies to the carryover of unallowed expenses. Some of these expenses might have to be carried over to the next tax year. Consult with a tax professional to determine if this applies to you and your business.

Can Form 8829 Be E-Filed?

Form 8829 accompanies Schedule C with your 1040 tax return so that you can e-file it along with these documents. If you work with a professional tax preparer, many of them are also authorized, e-file providers.

Tax software will e-file your return and attachments for you, or you can use IRS Free File to prepare your return and e-file it if your adjusted gross income (AGI) was $73,000 or less for the current tax year.

Where To Mail Form 8829

You can mail your tax return and its accompanying schedules and forms if you prefer not to e-file. The address you'd use depends on your state of residence. The IRS provides a state-by-state list online.

Tips for Completing Form 8829

There are several steps you can take to support your home office deduction:

  • Make sure there's nothing in your work area that's not related to your business when you measure the square footage of your business space.
  • Take several photos of the area from different angles, so it's clear that the area is used exclusively for business.
  • Time and date the photo and keep a copy of it in a safe place.
  • Don't include bathrooms, the garage, or the basement unless it's furnished when you're calculating the full square footage of your home.
  • Keep the measurements in a safe place or in your tax file.

A realtor's listing from when you purchased the home, or any legal document that includes its square footage, will help to verify the total square footage of your home. Your landlord will most likely have this information on hand if you rent your home. Otherwise, get a good measuring tape and walk around taking measurements of each room.

Collect information on home expenses for the year, including property tax payments, mortgage interest statements, utility bills, homeowner's insurance, rent payments, repairs, and maintenance expenses.

You don't necessarily have to complete Form 8829 to claim this deduction. The IRS offers a simplified home office deduction method for small home offices of up to 300 square feet. You can simply multiply the square footage of your workspace and multiply it by $5.

Note

The simplified deduction method might work out to a lower tax deduction amount than what you might qualify for with the traditional deduction. Consider calculating your deduction both ways or check with your tax professional to find out if it's right for you.

Frequently Asked Questions (FAQs)

What is excess mortgage interest on Form 8829?

Excess mortgage interest on Form 8829 refers to mortgage interest payments that exceed the limits on personal expense deductions. If you used your mortgage to buy, build, or substantially improve the home in which you conduct your business, then it can be added to Form 8829.

How many days per week do you have to work from home to get a tax break?

To qualify for tax breaks related to home offices, the home office needs to be your principal place of business where you conduct business on a regular basis. There isn't a set requirement in terms of days or hours.

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Sources
The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. IRS. "About Form 8829, Expenses for Business Use of Your Home."

  2. IRS. "Home Office Deduction."

  3. IRS. "Form 8829: Expenses for Business Use of Your Home."

  4. IRS. "Electronic Filing Options for Individuals."

  5. IRS. "IRS Free File: Do Your Taxes for Free."

  6. IRS. "Simplified Option for Home Office Deduction."

  7. IRS. "Instructions for Form 8829," Page 3.

  8. IRS. "IRS Reminds Taxpayers of the Home Office Deduction Rules During Small Business Week."

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