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My company did internet reimbursement. But most people don't know that there are massive tax benefits to working from home (at least in Canada) you can write o

My company did internet reimbursement. But most people don't know that there are massive tax benefits to working from home (at least in Canada) you can write off the percentage of your house you work in of your rent and stuff like that. That alone can equal a $1000 a year or so. But from a company point of view, getting rid of the office is a massive save in money, so I suspect some will increase salaries or offer other perks such as skipthedishes accounts or what not. Most will just pocket it though.

jlos 6y ago
There are trade offs with that too. If you use a home office for a write off, you have to pay tax when you sell the home
- pixl97 6y ago
  How does that work for a rental?
- dubcanada 6y ago
  I assume that's in the US? You don't have to do that in Canada.
  - leetcrew 6y ago
    I don't think you get to write off work expenses as a W2 (ie, hourly or salaried) employee in the US. pretty sure only independent contractors get to do this. otherwise, everyone would be doing this for commuting expenses.
    - xav0989 6y ago
      (At least in Canada) commute to your "usual place of business" is explicitely excluded from write-off. Also, if your employer reimburses you for travel (mileage) you can't write it off at tax time.
  - refurb 6y ago
    It applies to Canada as well. Claim 25% of your home as a business expense means 25% of any capital gains are taxed, unlike your primary residence which isn’t taxed. “You may have to report a capital gain if you change your principal residence to a rental or business property, or vice versa.” https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-127-capital-gains/principal-residence-other-real-estate/changes-use/changing-part-your-principal-residence-a-rental-business-property.html https://www.canada.ca/en/revenue-agency/services/tax/individ... However, it looks like there were some changes that may allow you to avoid it (business use was a small fraction and you didn’t take advantage of tax benefits from business use).
deleted 6y ago
[deleted]
hn_throwaway_99 6y ago
> But most people don't know that there are massive tax benefits to working from home (at least in Canada) That's generally not true for workers in the US. If you are self-employed, yes, you can take a home office deduction, but not if you are a W2 employee. The US used to have an "unreimbursed employee expense" itemized deduction, but even then there was a pretty high floor (had to be more than a couple percent of your total income) so most people couldn't make use of it. That deduction was eliminated in the 2018 tax law.
- throwaway987978 6y ago
  I don't think that's true in Canada either. I think it's only true if you're self-employed.
Solvitieg 6y ago
I think this is an exaggeration. The "massive tax benefit" is not that large for most people. Perhaps if you have dedicated office space and a large mortgage. I did the math for my T2200 and the total tax benefit was $500/yr.
- dubcanada 6y ago
  2x is hardly exaggeration, but my amount was including extras and other office stuff you can write off (power, internet, heating, office supplies, etx)

jlos 6y ago

There are trade offs with that too. If you use a home office for a write off, you have to pay tax when you sell the home

pixl97 6y ago
How does that work for a rental?
dubcanada 6y ago
I assume that's in the US? You don't have to do that in Canada.
- leetcrew 6y ago
  I don't think you get to write off work expenses as a W2 (ie, hourly or salaried) employee in the US. pretty sure only independent contractors get to do this. otherwise, everyone would be doing this for commuting expenses.
  - xav0989 6y ago
    (At least in Canada) commute to your "usual place of business" is explicitely excluded from write-off. Also, if your employer reimburses you for travel (mileage) you can't write it off at tax time.
- refurb 6y ago
  It applies to Canada as well. Claim 25% of your home as a business expense means 25% of any capital gains are taxed, unlike your primary residence which isn’t taxed. “You may have to report a capital gain if you change your principal residence to a rental or business property, or vice versa.” https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-127-capital-gains/principal-residence-other-real-estate/changes-use/changing-part-your-principal-residence-a-rental-business-property.html https://www.canada.ca/en/revenue-agency/services/tax/individ... However, it looks like there were some changes that may allow you to avoid it (business use was a small fraction and you didn’t take advantage of tax benefits from business use).

deleted 6y ago

[deleted]

hn_throwaway_99 6y ago

> But most people don't know that there are massive tax benefits to working from home (at least in Canada) That's generally not true for workers in the US. If you are self-employed, yes, you can take a home office deduction, but not if you are a W2 employee. The US used to have an "unreimbursed employee expense" itemized deduction, but even then there was a pretty high floor (had to be more than a couple percent of your total income) so most people couldn't make use of it. That deduction was eliminated in the 2018 tax law.

throwaway987978 6y ago
I don't think that's true in Canada either. I think it's only true if you're self-employed.

Solvitieg 6y ago

I think this is an exaggeration. The "massive tax benefit" is not that large for most people. Perhaps if you have dedicated office space and a large mortgage. I did the math for my T2200 and the total tax benefit was $500/yr.

dubcanada 6y ago
2x is hardly exaggeration, but my amount was including extras and other office stuff you can write off (power, internet, heating, office supplies, etx)