Top Tax Write-Offs For Real Estate Agents

Real estate agents do a lot more than just list and sell properties. They advertise for their clients, they protect the home while it’s being viewed, they show the seller how to give their home more curb appeal, and they help buyers find that perfect home to create long-term memories of their family.

Most real estate agents don’t understand all the things they can write off to save them taxes. They often overlook the simplest items that are deductible in the course of their business activities. Like I always say, to be the best you need to immerse yourself into your business to know and understand every facet of it. You have to be the person with an answer to every question. It’s you being known as the go-to Guy or Gal when people think of you. It’s creating that reputation within your area that takes years of dedication, promotion, late hours of work and an “I will do what ever it takes” attitude. However, before you get sellin’, it’s important to know exactly what you can deduct on your tax return. Below are the most common deductions for real estate agents:

In the area of sales:
  • Advertising
  • appraisal fees
  • business cards
  • bank charges
  • clerical support
  • client gifts
  • courier services
  • commissions paid
  • referral fees
  • film processing
  • flowers and cards
  • locksmith and keys
  • lockboxes
  • map books
  • office expenses
  • open house related costs
  • rent
  • sales assistance
  • home repairs
  • signs
  • flags and banners
  • food
  • software (website, mls, etc)
  • photocopying
  • printing
  • stationary
  • other
In the area of professional expenses:
  • Dues
  • E&O insurance
  • legal fees
  • licenses
  • memberships
  • MLS
  • publications
  • seminars
  • continuing education
  • resumes
  • any other costs that maintain and increase your skill
In the area of communication:
  • Faxes
  • house phone
  • cell phone
  • additional phone lines
  • internet service lines
  • answering service that is needed to conduct your real estate business
In the area of equipment:
  • Briefcase
  • Calculators
  • desk
  • camera
  • furniture
  • filing cabinets
  • cell phone
  • tape recorder
  • telephone purchases
  • all other related equipment purchased for the business
In the area of automotive:
  • You can deduct your automobile expenses in two different ways. The first way is the regular method, the second way is the standard mileage rate method. To determine which method is best for you, you should look at the cost of your car for depreciation, gas, repairs, insurance, and all other related automotive expenses and add them up. Then, we compare those total costs to the total miles driven for business multiplied by the applicable mileage rate. Whichever is higher is the one you use on your taxes.

It is our goal to create the most advantageous tax saving scenario for your real estate business. In addition, we want to assist you in education on real estate trends, current taxation on short sales and foreclosures, what entity type would best fit you as a real estate agent and provide your prospects with tax advice that is so important to them prior to selling their property.

We wish you much success in your real estate business!

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