As part of our continued efforts to help realtors save on their taxes, we’ve compiled a list of some more commonly used deductions. (DFW Realtor Tax Advisors: Deductions For Realtors)
Since realtors are self-employed sole proprietors, they are eligible for the same deductions as other self-employed business owners.
Allowable tax deductions you need to know
Take advantage of every tax deduction you can. Even minor costs are deductible, and they don’t have to be critical to your business to count.
Here are some of the most common real estate agent and broker deductions:
- Marketing: sales and open house signs and flyers; website development and maintenance; business cards and mailers
- Real estate coaching, training, and education costs
- Real estate licensing and renewal fees
- Real estate association dues, multiple listing service (MLS) dues and brokerage desk fees
- Transportation: automobile maintenance and repairs, gas, mileage, auto insurance, parking and new car purchase or lease costs
- Travel airfare, lodging, and meals for real estate education and business purposes
- Home office expenses, whether you rent or own your home
- Gifts ($25 deduction limit), entertainment, and other costs you incur to please clients and keep them coming back to you for their real estate needs
Keep in mind that to qualify as a deductible, real estate business expenses must be: ordinary and necessary, directly related to your business and a reasonable amount. IRS Publications 463 and 535 can help you determine whether a specific expense is tax deductible.
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