In case you missed it, NAR did a great video (Facebook live event they taped), that showed how the tax changes will affect Realtors, Brokerages, commercial property investors and homeowners. You can view the video here. (47 minutes, fast forward to minute 4) Learn about the new 20-percent deduction for pass-through entities, how new expensing provisions work, and what other changes are in the bill that affect your tax liability as a real estate agent or broker. The following examples (detailed in the article The Tax Cuts and Jobs Act – What it Means for Homeowners and Real Estate Professionals) illustrate how these new changes would affect different real estate professionals based on how their income is earned, income they may claim from a spouse, and how their business is structured. NAR members should consult a tax professional about their own personal circumstances.
Example 1: Amy Agent, a single filer with sole income from real estate commissions
Example 2: Andy Agent, a married filer with children with income from his real estate business and W-2 income from his spouse
Example 3: Barry Broker, a single filer with income passed through his real estate LLC
Example 4: Bobbie Broker, a married filer with income passed through her real estate LLC and salary income from her spouse
Example 5: David Developer, a married filer with income from his development S corp, which also has wage employees and capital at risk
Feel free to share with whomever does your taxes!