Professors' Home Office Expenses: A Recent Development and Economic Extension.

Abstract ABSTRACT: The deductibility of professors' home office expenses has been increasingly liberalized for the last 13 years, resulting in a favorable income tax deduction. Recent legislation has limited this deduction severely, although with proper tax planning, a number of professors still will find it available. The purpose of this article is to examine the availability of the home office deduction under the new legislation and to illustrate the economic feasibility of taking it even when the deduction is allowable. A table provides the economic results of taking the home office deduction under various combinations of personal residence ownership periods and total home office deductions to depreciation ratios. As illustrated, the home office deduction is not economically feasible in a number of circumstances.