Accounting for Real Estate Brokers & Agents in California
Presti & Naegele offers state-wide accounting for real estate brokers & agents, providing tailored tax solutions for professionals working in California’s diverse and competitive real estate markets. Every agent faces a unique set of tax responsibilities, and our approach ensures you're equipped with the guidance you need to stay compliant and confident.
Whether you're closing deals in the Bay Area, managing luxury listings in Southern California, or helping first-time buyers in Central Valley, real estate professionals throughout California count on us for clear, customized tax support.
Real Estate Agents and Brokers in California
In California, real estate agents are classified as self-employed. That means you’re responsible for handling your own self-employment taxes—covering both Social Security and Medicare. California also imposes state income tax, so it’s essential to make quarterly estimated tax payments to avoid interest and penalties.
CHOOSING THE RIGHT BUSINESS ENTITY in California
Legal Structure: How your real estate business is set up will directly affect how you're taxed in California. At Presti & Naegele, we work with agents to help determine the best business structure for long-term success.
✔ Sole Proprietorship – Straightforward to manage, with income and expenses reported on your personal tax return.
✔ Limited Liability Company (LLC) – Provides liability protection with flexible tax classification options.
✔ Partnership – Best suited for agents sharing business responsibilities and profits.
✔ S-Corporation – A pass-through tax entity that can help reduce overall tax liability depending on income and structure.
✔ C-Corporation – A separate legal entity with its own tax filings, typically used in more complex real estate operations.
Record Keeping
With the volume and pace of California real estate transactions, staying organized is critical. Our property accounting services in California help agents maintain accurate records for commissions, deductions, and essential tax documentation throughout the year.
That's why you need
Property Accounting Services.
Tax Deductions
California real estate agents working independently can take advantage of a wide range of tax deductions. Our property accounting services ensure you apply them properly to reduce your taxable income. Common deductions include:
✔ Business Expenses: Including marketing, listing services, signage, and professional subscriptions.
✔ Home Office Deduction: If you use a dedicated space at home for work, you may be able to deduct a portion of your household costs.
✔ Vehicle Expenses: Driving to showings, client meetings, or open houses may qualify for mileage or vehicle-related deductions.
✔ Meals and Entertainment: Certain client-related meals may be partially deductible.
✔ Education and Training: Ongoing education, licensing renewals, and real estate seminars.
✔ Health Insurance Premiums: Deductible if you're self-employed and covering your own health insurance.
Retirement Planning
Real estate agents throughout California have access to multiple retirement plans designed to reduce taxable income while helping you build long-term savings. Choosing the right one depends on your income and business structure.
✔ Solo 401K Plans – Offers large annual contribution limits and tax-deferred growth, ideal for independent agents.
✔ Simplified Employee Pension (SEP) IRAs – Flexible and easy to manage, with contributions based on net earnings.
✔ Defined Benefit Plans – A structured retirement plan that provides consistent benefits and allows for large annual deductions.
✔ Health Savings Accounts (HSA): Allows deductible contributions, tax-free investment growth, and tax-free withdrawals for medical expenses.
Need More Information?
Contact Presti & Naegele today for a free consultation regarding property accounting services for real estate brokers and agents in California.
For inquiries or expert guidance, contact Presti & Naegele Accounting Offices. Your success awaits!
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WHAT OUR CLIENTS ARE SAYING
I have had my business for more than 10 years and struggled through several *truly awful* accountants in the early years. I found Presti & Naegele about five years ago and have never looked back. They are a life-changing breath of fresh air and they will be my accountants for as long as I live. Donald Sager brings me confidence, peace and calm in an area of the business that would otherwise be stressful. He knows what he's doing and is always extremely responsive and ready with a plan of action and to explain anything at all. I am so grateful for him!
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