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Travel Agent Home Office Deduction

Updated: Apr 22, 2023

Many travel agents today are working from home. I mean why not, most everything you do can be done online and if your already paying for a place to live, why not work there to. One great perk of working at home is the ability to deduct some of those expenses. The home office deduction is one of the best deduction out there for travel agents. Read to learn more.

If you use a part of your home for business, you may be able to deduct expenses for the business use of your home. The home office deduction is available for homeowners and renters, and applies to all types of homes. But, a few rules do apply (as usual).


There are two basic requirements for your home office to qualify as a deduction:

  1. Regular and exclusive use.

  2. Principal place of your business.

Regular and Exclusive Use

This is an area of your house that you use regularly and exclusively for business. It might be a dedicated office or simply an area of the house. It's important to make sure it business only in that area. The best way for an at home travel agent is to set up a desk in your home, spread out your brochures, vendor booth items etc. Others in your home might not be happy, but you need to take control of an area in your home. Don't get greedy, it doesn't take a huge space to run an at home travel agency and the IRS knows this. Once you have secured an area of your home for your work, measure the space to determine the square footage (length x width = Square Footage).


Principal Place of Business

You must show that you use your home as your principal place of business. If you conduct business at a location outside of your home, but also use your home substantially and regularly to conduct business, you may still qualify for a home office deduction. If you have a brick and mortar office and just work from home periodically, you might not qualify.


How to Calculate Your Home Office Deduction (2 Methods)


Simplified Method

As easy as it gets!

Step 1: Multiply the square footage of your dedicated office area by $5.00.

Step 2: Thats it, you are done. Now it does max out at $1,500.00. So no offices bigger that 300 square feet.


Actual Cost Method

This method requires a little more documentation and math but can usually results in a pretty big deduction. The actual method allows you to deduct a percentage of the expenses to maintain your home. For example, If you live in a 1,000 square foot home and your dedicated business office occupies 50 square feet of that, you can deduct 5% (50/1,000) of many of your home expenses. This can include rent, mortgage interest, utilities, security systems, internet, insurance, etc. So if you spent $20,000 over the year on all those things, you may be able to deduct upwards of $1,000 as a home office deduction!


I always recommend to clients that you use caution and be reasonable when claiming a home office deduction. The square footage of your office in relation to your home is likely what will get you in the most trouble. If you live in a 800 square foot house and claim that you are using 300 square feet as an office for one person, it is likely to toss up some red flags. It doesn't take a huge space to run a travel agency, and the IRS knows this.


I put together this fun little calculator to give you an idea on what your potential home office deduction could be. Feel free to give it a try!



If you enjoyed this article please feel free to comment below. If you are looking for a tax professional that understands travel agents or just want to learn more, do not hesitate to reach out. Take care and safe travel!


Andy Roed


I am a tax professional and financial educator focusing primarily on helping travel agents. I am someone who is married to a travel agent, loves to travel and loves everything finance. The intersection of these passions has led me to a career that I am truly passionate about.


If you found this article interesting and are interested in more like it or are looking for someone to help you with all things taxes and finance please visit me at www.taxesfortravelagents.com .

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