This is a question I get asked at least once a week and the answer is a resounding NO. Taking a home office deduction to which you are entitled will not result in you getting flagged for audit.
Back in 2000, the IRS did in fact use to do in person home office checks. One of my clients in Santa Monica opened his front door to find an IRS agent there wanting to see his office space. I have not seen this happen since 2000! Have you ever tried calling the IRS? There is no one there! They are 20% under staffed from 2021. They simply do not have the people to send out to do office checks anymore.
Worst case scenario is you may receive a notice asking about the square footage of your home vs your office and how the space is used. If you are accurate in your home office calculation, this is also extremely unlikely to happen. I see these kinds of notices where taxpayers get greedy and deduct 80% or 100% of their home for office space.
So, as you start to think about filing your 2021 personal income tax return, please don’t forego this extremely valuable deduction.
If you have any concerns at all, go to our website https://wendybarlin.com and get a free download “Home Office Deduction Summary Sheet”