What income do you include when calculating the new 20 percent business income deduction?
Independent contractors and sole proprietors are eligible for the deduction that was introduced as part of the federal Tax Cuts and Jobs Act enacted last year, but the details can be confusing. For example, do you take the deduction before or after accounting for marketing and other business costs?
The IRS plans to release rules by December on how to apply the tax law changes, but that info will arrive a bit late for independent-contractor Realtors who must pay estimated 2018 quarterly tax filings.
To help members understand the tax changes, the National Association of Realtors® (NAR) created a series of videos on what real estate professionals need to know.
Important note, however: The videos aren’t a replacement for talking with your accountant or tax adviser. However, you can get information about the parts of the law that apply to Realtors as both a practitioner and a homeowner or renter.
The videos look at three ways the tax changes can affect Realtors: 1) as an independent contractor or sole proprietor, 2) as a homeowner or renter, and 3) as an individual or joint filer.
© 2018 Florida Realtors®