Using The Direct Sales Home Office Deduction

Posted on October 1st, 2018 by Deb Bixler

A direct sales business has benefits beyond meeting new people and generating your own income.

Benefits Of Home Office Deduction

how to write your business planAs a home-based company, your direct sales business also offers tax deductions that you could not normally take as a wage earner.

When you use your home as an office, it is like generating a second income. To take full advantage of the potential benefits of tax deductions associated with a home office, become familiar with the different kinds of information you need to collect for your tax accountant then allow him or her to make the final decisions.

If growing a sales organizations is one of your goals then it should be included in your business plan. Writing a business plan is creating a path to your goals that justifies your home office deduction by showing your intent.

What Expenses To Deduct?

There are many things that are deductible.  It is important to find an accountant who is direct sales friendly.  A few of the expenses to deduct include:

  • Office Equipment

Any kind of equipment you use for your office could be a deduction on your income taxes. Keep receipts for every phone, computer, monitor, printer and any other office equipment you purchase. If you do not have a receipt for the equipment you are using, then make a note of the model, manufacturer, serial number and retail price for your accountant.

  • Office Supplies

When you use office supplies in home-based business, you could be creating tax deductions for yourself. Supplies such as printer ink, blank CDs, labels, paper, envelopes and pens are all deductible if you used them for your business.

The major difference between office supplies and office equipment is that you will need to have receipts for every office supply you purchase. Keep a log of all of your purchases and make sure you have a store receipt to back up every purchase.

  • Office Area

Measure the size of the area you use for your office space at home and bring that number to your accountant. It is easier if you have your work area in one central location in the house and you can measure the whole thing with one set of dimensions.

You will want to collect all of your utility bills for your home along with any Internet access bills to bring to the accountant as well. Your accountant will use the size of your home office to determine how much of your utilities are deductible on your income taxes.

  • Mileage

The miles that you drive while setting up and attending home demonstrations are all deductible on your federal taxes. You can purchase a log book that will help you keep detailed records on the miles you have traveled and the purpose for each trip.

Learn More About The Home Office Deduction

Tax deductions associated with a home-based business can act like a second income. Once you have documented and collected all of the pertinent information, the rest is up to your tax accountant.

Deb Bixler provides free training and education on the Cash Flow Show – Home Business Radio!

Learn more about the home office deduction and how to write a direct sales marketing plan by visiting the Cash Flow Show website.

About the Author

Deb Bixler is the 2011 DSWA Speaker Of The Year and the DSWA party plan adviser.

Visit her party plan training center for real action steps to grow your business: or learn more about hiring Deb as a speaker for your group at: