Real Estate Agent Tax Guide

Knowing the above, it’s important to give one of my biggest pieces of advice — you pretty much should NEVER do something just because you expect it to help on your taxes. Spend money only if you have to, or because it’s the best idea for your business! This has two benefits: 1 — you don’t waste money on stupid s**t. 2 — chances are the deduction is legitimate.

So now comes the part you’ve been waiting for: What the hell can I deduct? Here’s a non exhaustive list, with some details, to get you started:

Marketing Expenses. Business cards, website fees, MLS dues, lead generating expenses, posters, signs, sponsorships, commercials, advertising, pretty much anything you do to get someone to call YOU when they want to buy or sell a house. As a non-tax aside, you need to evaluate these carefully, and talk to experienced agents to find the best of these. Your commissions are big, but come infrequently. You need to understand how much you spend for each commission so you can properly evaluate what works best.

Good, cheap marketing techniques here (this purchase would be a tax deduction. )

Gifts and Referral Rewards. Gifts to clients are generally limited to $25 per person, per year. (Thats the deductible amount, you can give more.) Be careful of referral fees. You should have received more training on this than me to get your license, but I will simply remind you that there are varying rules from state to state, as well as RESPA requirements that restrict what amounts, how and to whom you may pay a referral fee, so, check with your senior brokers before paying these. If the referral fees are legal, there are ways to deduct them, but talk to your tax professional about them.

A great gift for buyers would be a copy of my tax book. It’s based on life events and has chapters like, I’m Getting Married, I’m Having a Child and, wait for it. I’m Buying a House! Please consider buying a ton and giving them to your new homeowners — they’ll thank you!

Everyday Taxes: A New Kind of Tax Guide by The Super Tax Genius

Training, Education and Licensing. Whatever you pay to maintain your ability to be an agent is deductible, as well as things you do to increase your skills, as well as what you are allowed to do in the field. Classes, seminars, books and certificates mostly all qualify.

You could deduct this book — which will also help you make more money in your business:

EntreLeadership: 20 Years of Practical Business Wisdom from the Trenches