Tax season is almost here, and as real estate agents, we have a number of expenses that can help us reduce overall taxes. The easiest way to take advantage of your deductions is to document all of your spending. If you didn’t keep good records in 2017, start now to make the next tax year easier. Here are a few things to keep in mind:
Home Office & Office Space
Your home office expenses can be a valuable tax deduction. From utilities and office supplies to furniture and desk fees, money spent on office space can lower what you owe in total taxes. Buying a new computer or tablet to use at least part of the time for work? Be sure to note it as a business asset.
Real estate agents spend a fair amount of time on the road, traveling to meet clients and showing potential homes. Be sure to take note of auto expenses and mileage when preparing your taxes. Other travel expenses like hotels for training seminars can also help.
Client Relations and Lead Generation
Do you regularly treat your clients to meals entertainment? These expenses, along with client gifts (under $25) can be valuable tax deductions. If you utilize a CRM tool or online advertising, be sure to note those costs as well.
Remember that the cost of the professionals you hire to help present and sell a home, including stagers, photographers and graphic designers, also counts as business expenses, which makes them deductible.
Fees and Dues
Have fee costs for continuing education, associations and Errors and Omissions insurance? Be sure to keep track of them as they are valuable deductions.
Staying on Top of Your Taxes
To keep tax season from coming as a surprise, it’s important to pay self-employment taxes quarterly. We recommend holding money from each closing in a separate savings account for tax time so you’ll never come up short.
The Benchmark Realty team members are not tax professionals. For the most accurate recording and cost savings during tax season, be sure to hire a CPA. If you’re an agent looking to improve your business next year, consider joining the Benchmark team. Take our quick online assessment today to find out if you’d be a fit at DiscoverBenchmark.com!