The IRS simplified option is $5 per square foot, up to 300 square feet ($1,500). The opening rate is $5. Editing it still cannot push the simplified deduction past $1,500. A 150 square foot office is $750.00 on that option. The regular-method sketch on the opening inputs (15% of $24,000) is $3,600.00, so the regular method is larger on those numbers.
Simplified option: $5 per square foot, 300 square feet maximum, $1,500 maximum, and only for space used regularly and exclusively. Form 8829 is the regular method. The $1,500 cap still applies if the rate is edited.
The space has to be used regularly and exclusively for business. Publication 587 is the IRS home-office publication for that exclusive-use rule. The simplified $5 rate is from the IRS simplified option page (last reviewed 2 Mar 2026). Topic 509 points the regular method at Form 8829: direct expenses in full, plus indirect expenses times the floor-space percentage.
Regular method depreciation and the gross-income limit are not modelled; Form 8829 decides. This page does not invent a depreciation number. The simplified deduction also cannot exceed the gross income from the business use of the home minus business expenses, and you choose a method for the year on a timely filed original return. This is not a filed return.
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