Realtors & Agents
Commission income planning, the S corporation question answered with real numbers, and quarterly projections that keep a variable year from becoming a surprise.
The 1099 Surprise
Most agents remember the first big commission check. Fewer remember being warned about what comes with 1099 income. Self-employment tax alone runs about 15.3% on top of regular income tax under current law. After a strong year, that first quarterly estimate or April bill can be genuinely painful.
And income never arrives on schedule. January looks nothing like June. A slow first quarter followed by a hot summer makes planning almost impossible if nobody is watching the numbers as the year unfolds. Most agents run their business day to day without anyone looking ahead at the tax picture.
That is the gap we fill. Year-round tax planning built around commission income, not an annual scramble in April.
The S Corporation Question
Every agent eventually hears about the S corporation election. The forums and Facebook groups are full of advice about it, most of it incomplete or wrong. The real question is not whether an S corp saves money. The question is whether it saves money for you, this year, at your income level, after you account for the costs and complexity.
We answer that question with actual numbers. We run the self-employment tax math against your projected income, factor in the additional payroll costs and filings that come with an S corp, and show you where the break-even point is. For some agents, the election makes sense starting around $80,000 to $100,000 in net income. For others, the math works differently. Under current rules, the savings can range from negligible to meaningful depending on your situation. We help you make the decision with real analysis instead of forum advice.
Quarterly Estimates That Track Reality
Quarterly Estimates That Track Reality
Commission income does not arrive on schedule. We build quarterly projections that update as your year unfolds, so your estimated payments reflect what is actually happening instead of what you hoped would happen back in January.
Variable Income, Planned For
Variable Income, Planned For
A slow start does not mean a slow year, and a strong spring does not mean you are done paying taxes. We track your income as it comes and adjust the plan so you are never caught off guard in April.
Expenses and Retirement That Flex
Real estate is an expense-heavy profession. Vehicle costs, marketing, client gifts, MLS fees, continuing education, home office if you work from one. These deductions add up, but only if they are tracked properly and categorized correctly from day one.
Vehicle expenses especially need attention. You can use the standard mileage rate or actual expenses, but the choice has to be made early and the records have to support it. Marketing is similar. Those closing gifts and client events are generally deductible, but only with documentation that connects them to your business activity. We make sure the tracking happens so the deductions hold up.
Retirement Plans That Flex
Retirement Plans That Flex
Commission income varies, and your retirement contributions can too. Solo 401(k) plans and SEP-IRAs let you contribute based on what you actually earned, with limits that go well beyond a traditional IRA. Under current law these contribution limits can reach into the tens of thousands annually, and we coordinate your retirement plan with your overall tax strategy.
The QBI Treatment
The QBI Treatment
Unlike some professions, real estate agents are generally not subject to the service-business limitations that reduce the qualified business income deduction at higher income levels. This can mean an additional deduction of up to 20% on qualified income under current rules. Worth verifying for your situation and the rules in place for your tax year.
Clean Books Make It Work
Everything described above requires clean books underneath. Quarterly projections need accurate income tracking. The S corp decision needs real numbers. Expense deductions need categorized transactions. Without a monthly close and organized records, the planning falls apart.
Most agents have a tax preparer and maybe a bookkeeper. Almost none have someone watching the full picture all year, making decisions before the year closes, and connecting the accounting to the tax strategy. That is the difference between filing a return and actually planning.
The Four Roles
The Four Roles
Every business needs a tax preparer, a tax advisor, a bookkeeper, and someone playing the CFO role. Most agents have the first and third at best. We cover all four, so the books connect to the planning and the planning connects to the return.
If You Also Invest
If You Also Invest
Many agents eventually buy property themselves. That is a different tax situation with its own planning levers, including depreciation strategy, cost segregation, and 1031 exchanges. If you are building a portfolio alongside your commission income, we work with both sides. Take a look at our real estate investor services or our tax planning page to see how it all connects.
Planning-First Tax & Accounting
The Next Step:
Start a Conversation
We begin with a clear understanding of your business, then define the engagement and establish pricing from the outset.