Get a jump on April 15 by jumping on your 2016 taxes now. To take full advantage of tax deductions coming your way as a real estate agent, first and foremost check with your professional tax advisor and/or your tax accountant.
Here is an initial list of areas that may be included as tax deductions for real estate agents.
Vehicle Expenses – if you drive more than 10,000 miles/year, consider taking a standard miles deduction (note date of trip, time, miles, purpose); if you drive less than 10,000 miles, consider an all care related expenses deduction. The all car related expenses option may include deductions for portions of a car lease, auto loan interest, auto insurance, maintenance (note that the amount of the deduction must be in proportion to your business driving time.)
Designate a Home Office – whatever space you designate as your office within you home must be used exclusively for business purposes. If you take a regular home office space deduction, there is no limit on the amount of space you designate. Portions of your mortgage, rent, utilities, insurance premiums may be included here. If you take a simplified method of home office deductions, 45 square feet up to $1,500. may be included
Write Off Desk Fees – whatever cost of office space you rent from a brokerage business. Using this deduction prohibits you from making a claim for a home office deduction.
Marketing and Advertising Costs – cost of promotional items and production costs. Digital and online costs including web design, hosting fees, SEO marketing, video production, Pay per click, etc.
Office Supplies – stationery, computers, photocopies, internet bills, tech bills, office phone
Software – accounting, lead generation, etc.
Fees, Licenses, Memberships, Insurance – (be specific)
Meals and Entertainment – 50% of total including tax and tips (note date, time, location, purpose) and don’t forget the gifts you gave at closing to clients!
Charitable Donations – up to 50% (list specific names and purposes of organizations)
Education, Networking, Travel – coaching, courses, trade shows, conferences, registration costs, travel costs, accommodations costs)
All of these “deductible” items need to be documented with receipts, check copies, etc.
Most importantly, consult with your tax advisor and/or your tax accountant. Any suggestion listed here is only a suggestion and NOT a professional opinion.