Once again, one of the best ways for real estate agents to keep more of their hard-earned cash is to use a dedicated mileage tracking app like TripLog. Keep an eye out for other potential tax deductions as well! We hope you find the information in this article useful. Realtors Get More Back on Their Taxes With TripLog Once again, the key aspect here is that you can directly tie the purchase to your business usage of it. This can also include things like furniture, a laptop, or a printer. Office paper, clipboards, pens, all of these things can add up to a fairly sizable deduction come tax time. Whatever supplies you purchase that are used directly in relation to your real estate business can be deducted. Realtor Tax Deduction #9: Office Supplies Keep in mind that you can’t deduct your couch or a bedroom dresser you just bought whose usage has nothing to do with your business. Some of the things you can deduct a portion of include utility bills, internet costs, insurance, rent, mortgage payments, repairs, etc. Related: How Technology Can Help Real Estate Agents Keep in mind that the IRS is very strict about qualifying for this deduction. you don’t pay any desk fees), you can take advantage of the home office deduction. If you run your real estate business exclusively out of your own home (i.e. Realtor Tax Deduction #8: Your Home Office This can also include a co-working space. Realtor Tax Deduction #7: Desk Feesĭesk fees are the fees that you pay to rent a desk/space at your broker’s office. Think tools like Calendly, DocuSign, a CRM tool, or a mileage and expense tracker. If you use computer software or apps to run your real estate business, you can deduct the costs of those products on your taxes. This might include fliers, signs, photographs, and even digital paid ads like Google Ads. Virtually anything you spend on marketing and advertising that are directly related to your business can be tax deductible. Realtor Tax Deduction #5: Marketing & Advertising Related: 9 Best Tools and Apps for CRE Agents & Companies (2023)ĭownload the app on iOS or Android and get started for free, or schedule a demo with one of our mileage experts to see what solution will work best for your needs. You can even automatically exempt your commutes! TripLog automatically starts tracking your mileage as you start driving, and stops when you stop, making tracking your business miles a breeze. We recommend using a modern mileage tracker app like TripLog. If you know you won’t be taking very many trips, you may be able to get away with pen-and-paper mileage logs, but these can be cumbersome and inaccurate. This rate takes into account the various costs of owning and operating a vehicle, including gas, depreciation, etc. This can result in significantly more money in your pocket come tax time.įor every 1 mile you drive, you can deduct 65.5 cents using the standard IRS mileage rate for 2023. Realtor Tax Deduction #4: MileageĪs a realtor, you’re going to be on the road quite a bit. If you pay commissions to your employees or associated real estate agents, you can deduct these as business expenses as well. When you file for your taxes, you will need to make this distinction. Keep in mind that if you are deducting the dues of a professional membership, the portion of your dues that go into political lobbying and advocacy are not deductible. Related: Common Tax Deductions To Plan For In 2023 You can also deduct the cost of professional memberships you are a part of, as well as your use of a multiple listing service (MLS). For example, your real estate license is tax deductible. Realtor Tax Deduction #2: Licenses & Membership FeesĪs a real estate agent, there are a number of potential licenses and fees that would fall under what the IRS considers tax deductible. This, along with other types of business insurance that are directly related to your real estate work, can be fully deductible on your taxes. Here are some easy things that you can deduct on your taxes as a real estate agent, which can potentially result in thousands of dollars back in your pocket every year! 9 Best Expenses You Can Deduct as a Realtor Realtor Tax Deduction #1: InsuranceĪs a realtor, you more than likely have professional liability insurance, otherwise known as errors and omissions insurance. As long as your business expenses are “necessary”, “common and accepted” in your line of work, and “appropriate” for your business, the IRS allows you to deduct such expenses from your taxes.įor instance, a plunger might not be a good deduction for a photography company, but it would be for, say, a plumber.
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