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I have a side gig and am setting up a separate home office area for exclusive side-gig use. I intend to take the home office deduction, but am not yet decided if I'll calculate it the simplified way ($5/sq. ft.) or the more complex way. In determining this, I need some clarity: is equipment purchased for exclusive use in the side gig and primarily in the home office, only deductible as part of the home office deduction? Or can it be its own separate business expense deduction?

In other words, if I use the simplified method for calculating the home office deduction, can I still deduct the cost of the equipment separately? Also, does it depend on the specific equipment? E.g. are hardware and furniture generally treated differently?

Details

My side gig is web development.

Equipment under consideration to purchase:

  • laptop
  • desk
  • Ethernet cables
  • Wifi extender
  • Rug

1 Answer 1

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Every separate item is deducted separately using its own depreciation schedule (or in case of small items as a misc expense or office supplies).

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  • when you say "its own depreciation schedule", does that include the option to deduct the entire expense outright in the first year?
    – James Dunn
    Apr 19 at 23:52
  • @JamesDunn if there's such an option then yes.
    – littleadv
    Apr 20 at 0:19

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