the same method for all home offices located in the same home. You cannot choose the optional method for one office and the traditional method for another.
Those choosing the optional standard method can deduct 100 percent of their property taxes and mortgage interest as itemized deductions on their Schedule A and do not have to pro-rate these amounts.
If you choose the optional method, you cannot claim depreciation on your home. The amount of allowable depreciation is deemed to be zero.
With both methods, the amount of home office deductions that may be used in any given year is limited to the net income from your writing business. With the traditional method, however, you can carry over the unused deductible expenses to later years. With the new optional method, you simply lose the benefit of the expense amount that exceeds your net profit. No amounts can be carried over to later years.
If your home office deductions averaged $5 or less per square foot in the past and you do not normally have excess expenses to carry forward, you would likely benefit from using the optional method because your record-keeping burden would be lessened and your tax computations would be simpler. If your deductions were greater than $5 per square foot or your home office deductions exceeded your net income and were carried forward, you would likely be better off using the traditional method.
Additional Medicare Tax
For wages and self-employment income above certain thresholds, an additional .9 percent Medicare tax applies beginning this year. The tax applies to married joint filers earning more than $250,000 a year, to married separate status filers with earnings greater than $125,000, and single and head-of-household filers with earnings above $200,000. If your earnings exceed these thresholds, be sure to keep this additional tax in mind when computing your estimated tax payments due. The worksheet in the Form 1040-ES instructions will guide you in computing the appropriate amount to pay in each due date.
Diane Kelly is a retired CPA/tax attorney and the author of the humorous Death and Taxes romantic mystery series from St. Martin’s Press.
Getting It Write at the WPA
Continued from page 12 where you go to find out what happens, how it happens, to touch the equipment, to see what a jail cell looks like, to ride along with a police officer on patrol. Here you can say, “In chapter two, I have such and so happen,” without worrying that the guy on the other end of the phone line is going to hang up on you (or possibly come lock you up). You can tell the reader (silently, maybe), “I have talked to a professional in the field, honey, and I got it right. I have seen it done. I have done it myself, and I know how this works.”
And verily I say unto you, the time it takes is worth it. The latest information about the 2013 Writers’ Police Academy is on the website, www.writerspoliceacademy.com.
Ashley McConnell has published short stories, poetry, and nonfiction as well as 17 novels in the fields of horror, fantasy, and media tie-ins. A longtime member of NINC, she also has belonged to SFFWA and SinC. She lives in the Southeast with two Morgan horses, nine cats, and a few goldfish in the horse tank. She is currently working on selfpublishing her backlist and developing a new series.