Description:
Can you deduct coworking or shared-office membership fees on your tax return if you work remotely as a W-2 employee and pay out of pocket? How do rules change if youβre an independent contractor, if your employer reimburses you, or if the reimbursement is treated as taxable income? What kind of receipts or documentation are typically required and do common practices differ by country or tax jurisdiction?
2 Answers
I ran into this when I switched from freelance to a W-2 job. In the U.S. a regular employee generally canβt deduct coworking fees on a federal return since those miscellaneous employee deductions were largely eliminated after 2017. If youβre self employed the fees are a normal business expense and go on Schedule C. If your employer reimburses under an accountable plan it is not taxable and you donβt deduct it. If they add it to your paycheck as taxable income you usually canβt separately deduct it as an employee. Keep invoices, payment records, membership contracts and a calendar showing business use. Rules and paperwork differ by country and by state, so check local guidance.
In some countries like Canada or the UK, remote work expenses including coworking fees might be deductible if they are necessary for your job and not reimbursed; check local rules.
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