Auto and Home Office Deductions for Real Estate Agents

New Course! Learn to correct depreciation errors using Form 3115

Topics Covered

Here's what you'll learn to minimize your taxes and stay out of trouble with the IRS.

Deductible Business Miles & Relationship to Home Office
Proper Recordkeeping to Easily Calculate Deduction & Satisfy IRS
When & How to Take Standard Mileage Rate
Claiming Actual Auto Expenses: When to Deduct, What To Deduct, How to Calculate
Auto Depreciation Basics
How to Have a Qualified Home Office
How to Use Simplified Deduction Method
When & How to Use Actual Cost Deduction Method
What is Deductible Using Actual Cost Method
Calculating Direct and Indirect Actual Expenses
Home Office Depreciation Basics
Minimizing Errors with Tax Software
When You Need a Tax Professional

It’s not uncommon for some full-time agents to drive upwards of 33,000 miles per year for business. That’s a lot of driving! It’s also a real estate agent’s most significant tax deduction! Correctly deducting 30,000 miles on an income tax return saves the average real estate agent over $6,000 every year!

As a real estate agent, you are considered a statutory non-employee for tax purposes. This means that you are treated as independent contractors by law. If you’re a commission-paid real estate agent… Congratulations! You’re a business owner!

Being a business owner definitely has its advantages. You are free to make your own hours and no longer shackled to a salary or an hourly wage. You control your financial destiny and can earn as much money as your talent and energy will allow. Capitalism at its finest. Boom!

But, being in business also has some surprising challenges. Chief among them is minimizing your largest expense: TAXES! If you’re a real estate agent whose spouse works or who has another job it is highly likely that every single dollar you earn from real estate will cost you well over forty cents in tax! Seriously. 40¢ per dollar. Still feel like hand to hand combat is the way to go? Yes? Read on my friend.

If you’re a real estate agent whose spouse works or who has another job it is highly likely that every single dollar you earn from real estate will cost you well over forty cents in tax!

This series is a valuable asset in helping you maximize legitimate tax deductions. It will help you cut your largest expense, TAXES. We want you to keep more of your hard earned money in YOUR pocket and there’s only one way to do that… wring every legitimate tax deduction you can find out of the tax code.

You will learn to squeeze every allowed deduction out of your business vehicle(s), how to audit-proof your auto deduction and, most importantly, how to maximize and simplify your mileage deduction by having a qualifying home office!

Remember, every $1,000 in deductions equals up to $430 in tax savings! Put more money in your pocket with Overnight Accountant’s Real Estate Agent: Auto and Home Office Deduction training course!

Lesson Listing

Here is a list of the lessons in this course and a brief description of what you'll learn in each lesson.

Course Introduction
Introduction to the Realtor Auto & Home Office Deductions Course.
Introduction to Auto Expense & Home Office Deduction
This lesson will cover the proof you must have to substantiate your auto deduction, the interaction between the home office and deductible auto expenses, and auto use that may be tempting, but dangerous, to deduct.
Auto Recordkeeping & Standard Mileage Rate
This lesson will cover the records you must keep to prove business use of your auto. It introduces the two methods of deducting business auto expenses and the most common deduction method, the standard mileage allowance.
Actual Auto Expense Deduction
Claiming actual auto expenses may prove a greater deduction for many full-time agents, particularly those who use an expensive automobile or one that gets poor gas mileage. It may also benefit those who use more than one auto for business. As you will learn in this lesson, claiming actual auto expenses can also be quite complex and time-consuming. The good news is that this lesson will help you to minimize errors and maximize your deduction while making sure you can pass audit scrutiny. The best news – If you’re claiming the standard mileage allowance, you can save this lesson for later!
Auto Depreciation
If you are claiming actual auto expenses, you must depreciate vehicles used for business use. Depreciation is a very complex tax topic, especially when it involves an auto used for both business and personal driving. This lesson covers the basics and will help you understand how auto depreciation works. If you’re claiming the standard mileage allowance, you can save this lesson for later.
Home Office Deduction Overview & Simplified Method
Having a qualified home office is generally a relatively small deduction, but it is the key to maximizing your auto deduction! This lesson will tell you what you must do to have a qualified home office. It will also cover the easiest, least risky way to claim the home office deduction, the Simplified Method.

Note: We apologize for the sound quality in several segments of this video.
Actual Cost Intro & Calculating Your Square Footage Percentage
Using the actual cost method can benefit those who have a large home office relative to the size of their home. It may also benefit renters and those who have high expenses such as utilities, property tax, and mortgage interest. The actual cost method can be quite complex. Like using the actual cost method for your auto, it requires substantial recordkeeping and forces you to depreciate a portion of your home. If you know you will be using the simplified method, you can save this lesson for later.

Note: We apologize for the sound quality in several segments of this video.
Home Office Actual Cost Direct and Indirect Expenses
Direct Expenses are those that only impact your home office (and are relatively rare). Indirect expenses are those your home office shares with your entire house.
Home Office: Actual Cost Method Depreciation of Home Office
You must depreciate your home office (unless you are renting the home that includes your home office). And, yes, is can get a little crazy.

All courses and articles are for informational purposes only and do not constitute tax advice. Taxes are complicated - do not act on course information without consulting a professional. Always refer to treasury regulation before making any tax decision. Read the full disclaimer.

Customers Say…

I just completed the 1099-NEC/MISC course - this was very helpful to me. It is greatly appreciated.
- Tammy L, Anchorage, AK, 1099-NEC & 1099-MISC Course (Training Edition) Course
Jam packed with info. I feel ready to finalize the year and tackle my taxes!
- Cassie, Biloxi, MS, Real Estate Agent Tax-Cut Library, Agent Edition Course
Your video was perfect for us. It was easy to follow and understand. I was able to complete our tax return.
- Chakima H, Mableton, GA, 1120-H Basics Course
I haven’t practiced in the accounting field in quite some time and wanted a refresher. The Overnight Account course 1099-Misc Basics was very helpful! It was simple to follow along and understand each section. I would highly recommend this course! Staff were quick to answer my question as well. I love that I can review the modules again, if needed, at any time. I will definitely be using them again for more classes.
- Tammy, Anchorage, AK, 1099-MISC Basics (Training Edition) Course
I haven’t practiced in the accounting field in quite some time and wanted a refresher. The Overnight Account course 1099-Misc Basics was very helpful! It was simple to follow along and understand each section. I would highly recommend this course! Staff were quick to answer my question as well. I love that I can review the modules again, if needed, at any time. I will definitely be using them again for more classes.
- Tammy, Anchorage, AK, 1099-MISC Basics Course