Real Estate Agents

Written By Teresia Perkinson

As a real estate agent in 2026, you are essentially a small business owner. Because you likely operate as a 1099 independent contractor, you can deduct any "ordinary and necessary" expenses required to run your business.

Under the "OB3 Act" (2025/2026), several key deductions have been expanded or made permanent. Here is the list of categories you should include in your spreadsheet to maximize your tax savings.

1. Vehicle & Travel (The "Road Warrior" Deductions)

This is usually an agent's largest deduction. In 2026, you have two choices:

  • Standard Mileage Rate: The IRS rate for 2026 is 72.5 cents per mile. This covers gas, repairs, insurance, and depreciation.

  • Actual Expenses: If you drive a luxury vehicle or a heavy SUV (over 6,000 lbs), you might prefer deducting actual costs (gas, oil, tires) plus Bonus Depreciation, which was extended for 2026.

  • Other Travel: 100% deductible costs for parking, tolls, and travel for out-of-town conferences (airfare, hotels, Uber).

2. Marketing & Lead Generation

Any money spent to get your name or your listings in front of people is fully deductible.

  • Digital: Facebook/Instagram/Google Ads, Zillow/Realtor.com leads, and SEO services.

  • Signage: Yard signs, open house A-frames, and "Sold" riders.

  • Media: Professional photography, drone video, 3D tours (Matterport), and staging fees.

  • Print: Business cards, direct mailers, and brochures.

3. Professional Fees & Dues

The "cost of entry" for being an agent is deductible.

  • Association Dues: NAR, State, and Local board fees.

  • MLS Fees: Monthly or annual subscription costs.

  • License Renewal: State licensing fees and mandated background checks.

  • Brokerage Fees: Desk fees, transaction fees (if paid by you), and E&O (Errors & Omissions) insurance.

4. Software & Technology

  • CRM & Tools: Subscriptions like Follow Up Boss, LionDesk, or Canva Pro.

  • E-Sign & Paperwork: DocuSign, DotLoop, or Dropbox.

  • Hardware: A portion of your cell phone bill, laptop, tablet, and home internet (based on business use percentage).

5. Client Relationship & Gifts

  • Closing Gifts: You can deduct up to $25 per person (or $50 for a married couple) per year. Note: Branded items like pens or calendars under $4 don't count toward this limit.

  • Business Meals: You can typically deduct 50% of the cost of meals where you are actively discussing business with a client or colleague.

6. The 20% QBI Deduction (Section 199A)

This is the "holy grail" for agents in 2026. Because the QBI deduction was made permanent by recent legislation, most agents can deduct 20% of their net business income straight off the top of their tax return, before they even get to their personal tax bracket.

AGENTS! Stop guessing if you're profitable. Bring your last three settlement statements to a 'Profit Audit'. I’ll plug your numbers into the dashboard, and we’ll find exactly where your business is leaking cash. Click here to book your 15-minute audit.

Teresia Perkinson
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