The simplified home office method belongs on Line 30, line 30, business use of your home.
Why line 30
Both methods end in the same place, line 30, and you choose year by year. The simplified method multiplies a prescribed rate per square foot, which has been $5 for recent tax years, by up to 300 square feet of qualifying space, so it caps out at $1,500 and needs no Form 8829, only the worksheet in the Schedule C instructions. Form 8829 instead allocates your actual home costs by business percentage, which usually beats the flat rate once rent or mortgage interest is meaningful, and it allows depreciation and a carryover of amounts the gross income limit blocked. The trade is arithmetic against record keeping: the simplified method asks only for the square footage.
Log it once, with the line already on it. Type an expense in plain words in ClaryBook and it is filed with a date, vendor, amount and what it was for, so the number your preparer needs for the simplified home office method is already written down.
Start for freeWhat the simplified home office method is confused with
- Schedule A, schedule a, personal itemised deduction
- Under the simplified method you deduct nothing for mortgage interest and real estate taxes through the business, so claim the full amounts on Schedule A instead of allocating them.
- Line 20b, rent or lease of other business property
- Neither method is rent, so do not put any part of a simplified method figure on line 20b.
Examples that belong on line 30
- 200 square foot office at the $5 rate: $1,000 to line 30, no Form 8829
- 400 square foot office: still capped at 300 square feet under the simplified method
- $24,000 annual rent with 12% business use: $2,880 on Form 8829, well ahead of the flat rate
- A year with a small profit: the simplified method avoids computing a carryover you cannot use
- Switching to actual expenses the following year: allowed, and the depreciation for a simplified year stays at zero
What does not belong here
- Claiming both methods in the same year for the same space.
- Allocating mortgage interest and property tax to the business while also using the simplified rate.
- Carrying forward an unused simplified method amount, which is not allowed.
- Using more than 300 square feet in the simplified computation.
The limit that applies
A year on the simplified method is treated as having zero home depreciation, which cannot be recovered later, and no unused amount carries forward from a simplified year.
What to keep
The simplified method still needs proof the space qualifies, so keep the measurement and evidence of regular and exclusive use. Actual expenses need every home bill for the year plus the basis records for depreciation.
Other expenses on line 30
Related lookups
Sources
This page explains how Schedule C lines work. It is general information, not tax advice for your situation. If an expense is large or the answer turns on a fact about your business, confirm it with your tax preparer.
Looking for a different expense? The full Schedule C line lookup has every line from 8 to 27 with the expenses that belong on each, and Schedule C expense categories walks the whole form in order.
Log it once, with the line already on it. Type an expense in plain words in ClaryBook and it is filed with a date, vendor, amount and what it was for, so the number your preparer needs for the simplified home office method is already written down.
Start for free