WASHINGTON, Jan. 16, 2013 /PRNewswire-USNewswire/ -- The SBA Office of Advocacy applauds yesterday's decision by the Internal Revenue Service to offer a simplified version of the home office deduction. Advocacy has been engaged with the small business community and the IRS on this issue for decades, including a formal request to the White House in 2009. The new option allows a deduction of up to $1,500 based on a formula of $5 per square foot of home office spaced used and will take effect for the 2013 tax year. The IRS estimates that this change in the rule will reduce the paperwork burden on small businesses by 1.6 million hours annually. An estimated 14.4 million, or 52 percent of America's 27.8 million small businesses, are home based.
"Simplifying the home office deduction for America's small businesses has been a longstanding priority of the Office of Advocacy, we welcome the IRS's actions" said Chief Counsel for Advocacy Winslow Sargeant. "I would also like to commend the steadfast advocacy of numerous small business organizations who have championed this issue."
Over the years, Advocacy has worked with and the IRS to encourage the simplification of the home office business deduction. In 2009, Advocacy sent a letter to the Presidential Economic Recovery Advisory Board's Tax Reform Subcommittee, identifying the simplification of the home office business deduction as its top recommendation and suggesting that the IRS offer a standard deduction option. Advocacy will continue to pursue straightforward solutions for small business through tax reform.
The Office of Advocacy of the U.S. Small Business Administration (SBA) is an independent voice for small business within the federal government. The presidentially appointed and Senate confirmed Chief Counsel for Advocacy advances the views, concerns, and interests of small business before Congress, the White House, federal agencies, federal courts, and state policymakers. Regional advocates and an office in Washington, D.C., support the Chief Counsel's efforts. For more information, visit www.sba.gov/advocacy, or call (202) 205-6533.
Contact: Patrick Morris
SBA Number: 13-01 ADV
SOURCE Office of Advocacy of the U.S. Small Business Administration