"Being a real estate agent means wearing a lot of hats marketer, negotiator, chauffeur and sometimes even therapist. But when tax season rolls around, you also become the bookkeeper. The good news is that many of the things you already spend money on to run your business can help lower your tax bill if you know how to claim them."
"Of course, you could always hire an accountant to handle the details, but if you're brave enough to tackle your taxes yourself, it pays to know what you can write off. We'll walk through the most common real estate agent tax deductions, show where they appear on your forms and help you keep more of your hard-earned commission in your pocket and not the IRS's."
Real estate agents often handle marketing, negotiating, transportation, client management and bookkeeping themselves, especially during tax season. Most agents operate as independent contractors and must pay income and self-employment taxes without employer withholding. Business expenses such as mileage, courses, tools and other costs can be deducted to lower taxable income. Deductions are reported on Schedule C (Form 1040) and self-employment tax calculated on Schedule SE. Consistent expense tracking and claiming legitimate deductions reduces taxable income and preserves more commission. Twenty common deductions exist, including car and truck expenses reported on Schedule C, Line 9.
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