12 smart ways to cut your tax bill

You can't escape the paperwork, but you can find ways to save on your taxes.

How do I get a home-office deduction?
save taxes terri henry
Terri Henry, 52 and Greg Sabin, 61, Long Beach, Calif. Self-employed restaurant marketing/PR consultant and artist

Until 2012, as a small-business owner working from home, you had to figure out the ratio of your office space to the entire area of your home, then use that to measure what you could deduct for rent, utilities, and other expenses -- a hassle.

Starting in 2013, you'll have an easier option: Deduct $5 per square foot of space, up to $1,500.

Related: 12 audit red flags

What hasn't changed is the strict IRS definition of "office."

As CPA Andrew Newman of Davis, Calif., notes: "You can't have the same space be an office and a play area for kids."


  @Money - Last updated March 26 2013 11:25 AM ET
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