Rights & tax basics
Can my employer be required to reimburse home-office costs?
There is no general federal rule here, and some states have statutes that can apply to work-related expenses. We have read the primary text for three states so far. Other states may have laws too; we have not verified them, so check your state labor department.
| State | What the statute says (short quote) | Primary text |
|---|---|---|
| California | Employer "shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties". Labor Code 2802. | Text (Justia mirror) (checked Oct 17, 2026) |
| Illinois | Employer "shall reimburse an employee for all necessary expenditures or losses incurred by the employee within the employee's scope of employment and directly related to services performed for the employer". Submit with documentation within 30 calendar days unless a written policy allows more time. There are limits, for example when a written reimbursement policy exists and is not followed. 820 ILCS 115/9.5. | ilga.gov (checked Oct 17, 2026) |
| New Hampshire | Expenses incurred "in connection with his or her employment and at the request of the employer ... shall be reimbursed ... within 30 days of the presentation by the employee of proof of payment", except expenses normally borne by the employee as a precondition of employment. RSA 275:57. | gc.nh.gov (checked Oct 17, 2026) |
"Necessary," "at the request of the employer" and "required" are the words that usually decide these cases. Optional remote work may be treated differently from required remote work. Ask your state labor department.
Is a stipend or reimbursement taxed?
Under IRS rules, a reimbursement paid under an "accountable plan" (business connection, substantiation to the employer within a reasonable time, and return of any excess) is not treated as wages. Amounts that do not meet those rules are treated as paid under a nonaccountable plan and are wages subject to employment taxes. An IRS ruling describes a 60-day safe harbor for substantiating expenses to the payer. Source: 26 CFR 1.62-2 (accountable plans); IRS Revenue Ruling 2003-106 (checked Oct 17, 2026)
Practical takeaway: keep itemized receipts and a purpose for each purchase (the tracker helps), and ask payroll whether your stipend is paid as taxable pay or through an accountable plan.
Can I deduct my home office?
Employees (W-2): the IRS says employees can no longer claim a deduction for use of a home office, because miscellaneous itemized deductions for employee business expenses were eliminated for tax years beginning after 2017. Source: IRS: Simplified option for home office deduction (checked Oct 17, 2026)
Self-employed: if your home office is used regularly and exclusively for business, the simplified option is $5 per square foot of the space, up to 300 square feet (maximum $1,500). It does not change who qualifies. Calculator below is arithmetic only.
Enter square feet to see the simplified-method amount.
Source: IRS: Simplified option for home office deduction; IRS Publication 587 (2025) (checked Oct 17, 2026)