On Wednesday, February 17th, the Women’s Council of REALTORS® – Chicago Chapter held a Wealth Symposium featuring a panel which included Alfred Dynia, Dynia & Valente, LLC, Attorneys at Law. Dynia presented some great tax tips for REALTORS® and was kind enough to provide us with some to share with you. As always, keep in mind that not all real estate professionals have the same tax situation; these tax tips are merely suggestions of items to consider and should be confirmed for applicability with your individual tax adviser.
Car Expenses
- Easiest way to deduct auto expenses: using a standard mileage rate (57.5¢ per mile for 2015 and 54¢ per mile for 2016). *Note: there are other methods that may yield higher deductions – consult your tax advisor.
- Make a point to get an oil change on the first of every year. If you do that, you have a third-party document that shows your mileage.
- Better yet, use a mileage tracking app: MileIQ for Iphone and TripLog for Android.
Home Office Deduction
- REALTORS® who work from home may be able to take advantage of the home office tax deduction.
- This deduction is particularly valuable if you are a renter because it enables you to deduct a portion of your monthly rent, a sizable expense that is ordinarily not deductible.
- Some of the most commonly overlooked deductions include a percentage of renter’s or homeowner’s insurance, utilities, maintenance for the home office, depreciation of home office equipment and property taxes.
- There are rules and limits, so consult with your tax adviser.
Commonly-Missed Tax Deductions
- Online advertising.
- Car expenses. In addition to gas and mileage, REALTORS® can also deduct parking fees and tolls. And, don’t forget the money you spend in the Park Chicago app!
- Gifts and other expenses incurred in making your clients dreams a reality.
- Office supplies including, but not limited to, computer equipment, office supplies, postage, mailers and subscriptions to trade magazines.
- Meals and entertainment consumed before, during or immediately after a business-specific meeting.
- Insurance purchased specifically for your business.
