Has your employer paid you for those extra expenses? If not, can you write these items off on your taxes? The answer is yes, but first a little history! Prior to 2017, working-from-home costs were deductible as a personal exemption under “job and miscellaneous” expenses on your tax return.

While these working-from-home costs were not fully deductible up to 2017, it’s safe to say that most Americans probably recouped 25 percent of their monies under this former tax regime.

Assuming you qualified to write off such home-working expenses, you were probably eligible to deduct a variety of costs, such as electricity, heating and maintenance, rent, supplies, equipment and other utilities.

Itemized versus Standard Deductions 

But what about today? A federal tax law change, called The Tax Cuts and Jobs Act, was passed by the Trump Administration in 2017. Since then, this “job and miscellaneous” personal exemption has been eliminated from the list of itemized deductibles under the US tax code. At the same time, the new law almost doubled the standard tax deduction.

A single taxpayer’s standard deduction was significantly lower in 2017 at $6,350, compared with $12,200 after the tax change. Generally, taxpayers can choose whether they wish to apply a standard tax deduction or calculate their total taxes owed based on various itemized deductions. The standard deduction is probably quicker and easier. The itemized method is probably more accurate.

The rationale behind the tax change in 2017 was that a higher “standard deduction” would absorb the cost of such home-working expenses, which were previously itemized as “job and miscellaneous” deductions.

Now while some, including myself, would debate that logic, let me remind you that the same process does not apply to your state tax return. Most states, like New York, for example, still allow personal exemptions like the itemized “job and miscellaneous” deductions under the state tax code.

While you don’t get back the 25 percent that you would have gotten at the federal level, you do get your state tax bracket amount back. In the State of New York, while this varies, most people get back 15 percent. So, learn and keep track of your home and job expenses, and note that each state has its own rules and regulations.

But you figure you have to wait until next year? No! Since the federal government has extended the tax filing deadline to Jul. 15, most states have followed suit and so, there is still time to claim these home-working expenses.

If you have already filed your return for 2019 – no problem! Just speak to your tax representative about “amending” your state return to take these home-working job expenses into account. If you haven’t done your 2019 taxes yet – even better! Make sure to include these deductibles when you do file.

In the long run, it will be interesting to see if there is any future congressional demand to change the “working-from-home” tax code to bring it back to what it was prior to 2017. The tax code changes, implemented under The Tax Cuts and Jobs Act of 2017, were set to expire in 2025.

In the meantime, recouping fifteen cents on the dollar (at the state level) is better than nothing, right? Learn the rules! Keep track of those expenses and talk to your congressional candidates about putting “job and miscellaneous” expenses back into the federal tax code.

Because the coronavirus pandemic has changed our way of working, at least temporarily, from an employer’s perspective, “working from home” could become the new futuristic normal.

Professor Anthony Rivieccio, MBA PFA, is the founder and CEO of The Financial Advisors Group, celebrating its 24th year as a fee-only financial planning firm specializing in solving one’s financial problems. Mr. Rivieccio, a recognized financial expert since 1986, has been featured by many national and local media including: Kiplinger’s Personal Finance, The New York Post, News 12 The Bronx, Bloomberg News Radio, BronxNet Television, the Norwood News, The West Side Manhattan Gazette, Labor Press Magazine, Financial Planning Magazine, WINS 1010 Radio, The Co-Op City News, The Bronx News, thisisthebronX.info and The Bronx Chronicle. Mr.  Rivieccio also pens a financial article called “Money Talk”. Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University. You can reach Anthony at 347.575.5045.