Maximize Your Refund: Don't Miss These Legitimate Write-Offs
As a real estate professional, you incur unique expenses that are critical to running your business. The IRS allows you to deduct these "ordinary and necessary" costs to lower your taxable income. Use this checklist to ensure you are capturing every deduction you are entitled to for the 2025 tax year.
Vehicle & Transportation
Note: You must choose between the Standard Mileage Rate (70.5 cents per mile for 2025) OR Actual Expenses. You cannot do both.
- Mileage: Miles driven for showings, listing appointments, inspections, open houses, and trips to the hardware store.
- Parking & Tolls: Fees paid while working (not commuting to your main office).
- Auto Interest: Interest on a car loan (if using the Actual Expense method).
- Registration & Taxes: Vehicle registration fees and property tax on the vehicle.
Marketing & Advertising
- Lead Generation: Zillow Premier Agent, Realtor.com, Redfin, or other lead fees.
- Website: Hosting, domain names, design fees, and maintenance.
- Signage: Yard signs, open house directionals, riders, and lockboxes.
- Print Materials: Business cards, flyers, mailers, brochures, and postcards.
- Digital Ads: Facebook/Instagram ads, Google PPC, and social media management fees.
- Staging: Furniture rental, decor, and cleaning services for listings.
- Photography/Media: Professional listing photos, drone footage, and virtual tours.
Professional Development & Licensing
- Education: Continuing education (CE) courses and designation/certification classes.
- Coaching: Real estate coaching or mentorship programs.
- Dues: National (NAR), State, and Local association dues.
- MLS Fees: Multiple Listing Service access fees.
- Licensing: State license renewal fees.
- Conferences: Tickets and travel to industry events (e.g., KW Family Reunion, RE/MAX R4).
Office & Administration
- Desk Fees: Monthly fees paid to your broker.
- Software (SaaS): CRM (Follow Up Boss, LionDesk), DocuSign, Dotloop, Canva, QuickBooks.
- Communication: Second business phone line or percentage of cell phone bill used for business.
- Office Supplies: Ink, paper, folders, envelopes, and stamps.
- Equipment: Computer, laptop, iPad, camera, and printer (may need to be depreciated).
- Home Office: If you have a dedicated space used exclusively for business, you may deduct a portion of your mortgage interest, utilities, and insurance.
Client Care & Business Meals
- Closing Gifts: Deductible up to $25 per person per year. (Note: Branding/Marketing items like pens with your logo are not subject to this limit).
- Business Meals: 50% deductible if business is discussed with a client or colleague.
- Open House Refreshments: Food and drinks provided for the public at an open house (100% deductible as marketing).
Insurance & Professional Fees
- E&O Insurance: Errors and Omissions insurance premiums.
- Liability Insurance: General business liability policies.
- Legal Fees: Attorney fees for contract review or business formation (LLC set up).
- Tax Preparation: Fees paid to your accountant or tax preparer.
Important Compliance Note
- Keep Your Receipts: Credit card statements are often not enough. Keep itemized receipts.
- Track Your Mileage: The IRS requires a written log (or app log like MileIQ) showing the date, miles, and business purpose of every trip.
- Co-mingling Funds: Always pay for these expenses from your dedicated business bank account, not your personal checking account.
Disclaimer: This list is for educational purposes and does not constitute legal or tax advice. Deductibility depends on your specific business structure and situation. Please consult with KJC Tax Preparation & Bookkeeping to confirm your eligibility.