Does One Retirement Plan Affect How Much I Can Put in Another?

Expenses for an employee home office are deductible as a miscellaneous itemized deduction on your Schedule A. That means that your home office expenses, combined with any other miscellaneous itemized expenses, are only deductible to the extent they exceed 2% of your adjusted gross income (AGI). So if your AGI is $100,000 and you have $6,000 in home office expenses, you can deduct $4,000. (That's the excess over the 2% of your AGI, or $2,000.)

The test for an employee home office is pretty difficult to meet. You must designate an area that's used exclusively and regularly for your business, and the Internal Revenue Service takes those terms very literally. In addition, the office must be for your employer's convenience. In this case, it seems that it would be, because your employer is financing the cost of maintaining a home office.

(For more on the home office deduction for employees and the self-employed, see The Lowdown on Home Office Deductions.)

Even if you aren't eligible to claim all the expenses relating to a home office (such as a portion of your utility bills and mortgage payments), you're still eligible to claim supplies, an Internet connection (provided it's used entirely for work, no personal use) and the like as an unreimbursed business expense, which is also a miscellaneous itemized deduction.

"If there's no accounting to the employer, in other words, if you don't have to submit receipts in order to get reimbursed for the amount you spent," says Mark Castellucci, a CPA from Davis, Calif., "then the stipend they give you is taxable income and all you spend is deductible."

Same goes for your car.