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About Mike Wellman
Expertise
I was a former Manager with Price Waterhouse, now PricewaterhouseCoopers, the largest accounting firm in the world. I have had clients in almost every industry and of every size. I will only answer questions dealing with IRS problems such as delinquent tax returns, Offers in Compromise (Tax Settlement), IRS collection matters including installment agreements, liens, levies, seizures, audits, appeals, innocent spouse claims and injured spouse claims. All others will be referred to the question pool.
Experience
Over 25 years experience in taxation specializing in IRS collections, examinations and appeals.
Publications
New York Times, Wall Street Journal, You Money Magazine
Education/Credentials
BBA, Baylor University.
Awards and Honors
My website http://www.IRSOS.com won the Knowledgeweb award for educational excellence for content.
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You are here: Experts > Real Estate > Tax Planning: U.S. > Tax Planning > Real Estate Agency
Expert: Mike Wellman
Date: 12/17/2007
Subject: Real Estate Agency
Question
Good Afternoon Mr. Wellman,
I recently earned my real estate license and will do it on the side while I work my full time job.
I was considering starting an LLC and placing my license with it. Before doing so I'm wondering if you can advise if there are any tax benefits to doing so.
Also, is there any circumstance under which I can deduct expenses associated with my licensing such as the $400 Real Estate school tuition, $384 board of realors dues and broker fees?
Your advice is most appreciated.
Thanks!
Answer
An LLC will provide no significant tax benefits and will just add to your paperwork. A single member LLC files as a sole proprietor anyway so the income is reported on a Schedule C attached to your 1040.
Your annual license fees, broker fees, dues, etc. are certainly deductible. Also include at least a portion of your cell phone, mileage, supplies and any other expense you incur in selling real estate. The tuition may or may not be deductible depending on the circumstances - but probably not.
Good luck with your new venture!
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