Quick Tax Guide for the Self Employed in Real Estate
Published Thursday, April 13, 2023
If you are a licensed Real Estate Broker, you are considered an independent contractor or self-employed which means that you are a business owner that provides services to others and will be receiving a 1099. By being self-employed you may take all the money you receive up front, but you are still responsible for paying the Self-Employment Tax and income tax during the tax season. With that being said, it is important to set aside about 25-30% of your income to cover that.
Although it may sound a bit intimidating there is an upside to all of that and that is you can write off many real estate business expenses on your taxes!
Here are some things that may qualify as tax deductions for a Real Estate Broker:
- Realtor dues and subscriptions
- Property promotions for your listings
- Seminars & workshops related to your real estate business
- Website & hosting fees that are applicable to your real estate business
- Desk fees paid to your real estate sponsoring broker
- Office supplies and business cards
- Car related expenses; parking, tolls, car insurance, car purchase, etc.
- Business meals, gifts, entertainment particularly for your real estate buyers or sellers
- Real Estate meeting related expenses
- Home office related expenses
- And more…
Check out the websites below for more information and of course always have a conversation with your accountant on what is best for your situation.