Simplified Home Office Deduction

The IRS now allows you to calculate the home office deduction using $5 a square foot times the number of square foot used for the home office up to a maximum of 300 square feet so you can get a home office deduction up to $1,500 a year. You can still deduct 100% of your mortgage interest and property taxes as itemized deductions even if you use this method. The simplified method is still limited to net income from the business though. If you do the simplified method in one year, you can change to other comprehensive method the next.

Max and Min State Income Tax Rates

There are 7 states with no individual income tax which are Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. In three states the max rate is in the double digits with California being the highest at 12.3%. Hawaii is at 11% and Massachusetts is 12%. If you are thinking about moving, you should consider the state tax rates.