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Real Estate Agent Tax Advice

Real Estate Agent Tax Advice

Real estate agent tax advice in 2014 will include a new complicated formula on high end home sales. The Net Investment Income Tax is imposed by section 1411 of the Internal Revenue Code. The NIIT applies at a rate of 3.8% to certain net investment income of individuals, estates and trusts that have income above the statutory threshold amounts. In general, investment income includes, but is not limited to: interest, dividends, capital gains, rental and royalty income, non-qualified annuities, income from businesses involved in trading of financial instruments or commodities and businesses that are passive activities to the taxpayer (within the meaning of section 469). To calculate your Net Investment Income, your investment income is reduced by certain expenses properly allocable to the income.  This 3.8% tax is on investment income for “high earners.” The tax which went into effect in 2013 will be dedicated to the Medicare Trust Fund. “High earners” are defined as individuals whose gross income is $200,000 or more, or married couples filing jointly with...

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Tax Deductions for Real Estate Agents

Tax Deductions for Real Estate Agents

Tax deductions for real estate agents can help you reinvest in your business. Most real estate agents don’t understand all the things they can write off to save them taxes. They often overlook the simplest items that are deductible in the course of their business activities. You do a lot more than just list and sell properties. You advertise for your clients, protect the home while it’s being viewed, show the seller how to give their home more curb appeal, and help buyers find that perfect home to create long-term memories of their family. All this can lead to bigger tax deductions. Even the smallest expense done several times of over several years can save you hundreds if not thousands of dollars. You can also plan your business to take advantage of every possible deduction. Some tax deductions for real estate agents to consider are: Auto Travel Your auto expense is based on the number of qualified business miles you drive. Expenses for travel between business locations or daily...

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