Tax help for property managers and leasing agents
You collect rent, chase vendors, and show units all week. We handle the tax side, in English or Spanish.
Nothing is due today. Personal returns start at $250.
Property management income arrives in pieces. A management fee here, a leasing commission there, a referral bonus, maybe a Form 1099-NEC from a broker and another from an owner who pays you directly. The work is sorting out which of those dollars are yours to keep and which belong to an owner and were only passing through your hands. We do this work all year, so the questions start where you actually are.
What property managers can usually deduct
Ordinary and necessary costs of your work. Rules and dollar limits change year to year, so we confirm every one of these against the current year when we prepare your return.
Driving between properties
Trips from one property to the next, to a showing, to the county permit office, to the hardware store for a unit repair, and to a lease signing are business miles. Track the date, destination, and purpose, then take either the IRS standard mileage rate published for that year or your actual vehicle costs.
Driving from home to your regular office is commuting, and commuting miles are not deductible. Once you leave that office for a property, the miles count. If your home qualifies as your principal place of business, trips from home to a property can count, which is one reason the home office question matters here. Tell us how you have treated this vehicle in past years, because the method you used before can limit which method is available now.
Real estate license and CE
Your state license renewal, broker association dues, MLS and lockbox fees, and the continuing education hours your state requires to keep your license active.
Education that maintains or improves the skills your present work requires, or that your state requires to keep your license, is generally deductible. Education that qualifies you for a new trade or business, including the schooling that got you into the field in the first place, generally is not.
Property management software
AppFolio, Buildium, Yardi, Rent Manager, RentRedi, or whatever platform runs your leases, work orders, and owner statements. Add tenant screening and background check services, e-sign tools, and your bookkeeping subscription.
If you rebill screening fees to applicants, that fee income has to show up as income before the cost shows up as a deduction. Do not quietly net the two against each other.
Lockboxes, keys, and access
Smart lockboxes, rekeying after a move out, key duplication, garage remotes, fob programming, and self showing hardware for vacant units. These are recurring costs in this trade that are easy to overlook.
One large purchase, such as a smart lock rollout across a whole building, may need to be capitalized and depreciated rather than deducted all at once. Elections and safe harbors exist that can allow a current deduction, so tell us the amount and the date and we will look at which one fits.
Listing photos and marketing
Photographers, floor plans, 3D tours, drone shots, featured listing upgrades on rental sites, yard signs, riders, banners, and printed brochures for a lease up.
If an owner reimburses you for marketing on their property, the reimbursement is generally income to you and the cost is your deduction, unless you handled it purely as an agent out of the owner's funds. Your management agreement and your bookkeeping decide which it is.
Phone and answering service
You take maintenance calls at all hours. Deduct the business share of your cell plan, a second line or after hours answering service if you carry one, and the business portion of home internet.
You can deduct only the business share, and you need to be able to explain how you arrived at that percentage. If it is your only phone, the personal use has to come out of the number.
Home office for the back end
If you run leases, owner statements, and vendor scheduling from a dedicated space at home, you may deduct a share of rent or mortgage interest, property tax, utilities, and insurance, or use the simplified method the IRS provides.
The space has to be used regularly and exclusively for business, and it generally has to be your principal place of business or a place where you meet clients in the normal course of the work. A corner of the living room the family also uses does not qualify. The deduction is also limited by the income of the business, so it generally cannot create a loss.
Insurance you carry yourself
Errors and omissions coverage, general liability, a commercial rider on your vehicle, and any bond your state or a client requires of a property manager.
Coverage on a property you own personally belongs with that rental property, not with your management business. Keep the two apart.
Small tools and supplies you absorb
The plunger, the drain snake, air filters, batteries, smoke detectors, bulbs, touch up paint, cleaning supplies, and the plastic bins in your trunk. When you cover these instead of billing the owner, they are yours to deduct.
If you bill it back to the owner, the reimbursement is income and the item is the deduction. Only what you actually absorb reduces your profit.
Vendors and contract leasing agents
Handymen, cleaners, landscapers, pool techs, locksmiths, and the leasing agents you pay on a commission split. Amounts paid out of your own business funds are deductible.
Pay an unincorporated vendor for services at or above the IRS reporting threshold that applies for that year and you generally owe them a Form 1099-NEC. Collect a Form W-9 before the first check, not in January when nobody answers the phone.
Eviction and filing costs
Court filing fees, process server charges, and attorney fees paid in your own business name, plus notary and courier costs for lease packets and owner documents.
Costs you advance for an owner and later recover are not your expense. They only become yours if you never get them back, and even then the treatment depends on how the advance was recorded in the first place.
Retirement contribution for yourself
As a self employed manager you can set up a SEP IRA or a solo 401(k), and contributions are generally deductible. No employer is doing this for you, so it only happens if you set it up.
Contribution limits apply and are adjusted from year to year, and the deadline to open the account is not the same as the deadline to fund it. Those deadlines also differ by plan type, so ask before year end rather than at filing time, because one of the doors may already be closed.
Schedule C is the usual starting point for a solo property manager, and it is a reasonable place to be. Once net profit from management fees is steady and large enough that self employment tax becomes a real number, an S corporation election is worth pricing out, because it can change how much of the profit is subject to that tax. It also brings payroll, a reasonable salary requirement, a separate business return, and state level filings. That makes it a math question and a paperwork question, not an automatic upgrade, and the answer depends on your actual numbers. We run the comparison before you change anything.
What to bring us
You do not need all of it to start. Send what you have and your checklist shows what is still open.
- Every Form 1099-NEC or Form 1099-MISC you received, from brokerages and from owners who paid you directly
- Your own record of management fees and leasing commissions collected, including anything paid in cash or by app
- Owner statements or a trust account summary, so we can separate your fee income from money that was never yours
- Your mileage log or app export, with total miles and business miles for the year
- Vehicle details: make, model, and the date you started using it for business
- Bank and credit card statements for every account you ran business money through
- Vendor and subcontractor payment totals plus a signed Form W-9 for each one
- Home office numbers: total square footage of the home, square footage of the dedicated space, and annual rent or mortgage interest, taxes, utilities, and insurance
- License renewal, association dues, MLS, and continuing education receipts
- Dates and amounts of any estimated tax payments you made during the year
What trips people up
Reporting gross rent collected as your income
Rent you collect and pass through to an owner is generally not your revenue. Your revenue is the management fee, the leasing commission, and any other charge you actually keep. Report your fees, and hold owner funds in a separate account so the line stays obvious.
Counting the drive to the office as business miles
Home to your regular office is commuting, unless your home is itself your principal place of business. Log the trips that count: office to property, property to property, property to vendor or courthouse. Write the date, address, and reason down in the moment, because reconstructing a year of driving from memory does not hold up.
Waiting until January to collect Form W-9s
Get a signed Form W-9 from every handyman, cleaner, and contract leasing agent before you write the first check. Once the work is done people stop returning calls, and you are the one facing the filing deadline.
Paying nothing in during the year
Nobody withholds tax from a management fee. You owe income tax plus self employment tax on the profit, and the IRS expects payments during the year. Set a share of every fee aside as it lands and make quarterly estimated payments so you are not facing the whole bill plus an underpayment penalty in April.
Running personal and business money through one account
Open a separate business checking account and card. It takes an afternoon, and it makes the business numbers easy to trace and easy to support if anyone ever asks.
What it costs
Our published list, the same one everyone sees. Prices marked "from" are starting points, and your exact number is confirmed in writing before any work begins.
$0 is due today. You pay when you sign, or you can have your fee come out of your refund, so it can be $0 out of pocket.
Questions we get from your trade
I get some 1099s and some payments straight from owners. Do I report all of it?+
Yes. All business income is reportable whether or not a form was issued. The 1099 is just a paper trail. If an owner paid you by check or app and never sent one, that fee still belongs on your return. Bring your own records and we will reconcile them against the forms that arrived.
Does the rent I collect for owners count as my income?+
Generally no. Money you hold and pass through to an owner is theirs. What belongs on your return is the management fee, leasing commission, late fee split, or other charge you actually keep. Clean trust accounting makes this simple to show, so bring your owner statements.
I also own a rental unit myself. Does that go on the same schedule?+
Usually not. Your management business generally goes on Schedule C as a trade or business, and rental property you own is generally reported on Schedule E. Different schedules, different rules, including how losses are treated. Bring both and we will place them correctly.
Can I deduct the clothes I wear to showings?+
Generally no. Clothing that is suitable for everyday wear is not deductible even if you only wear it for work, and that covers the blazer, the slacks, and the good shoes. Branded or logo clothing is not automatically deductible either, because the test is whether the item is genuinely unsuitable for ordinary use. Protective gear such as steel toe boots for a property walk is a stronger case. Ask us about the specific item.
What do I do about the vendors I paid this year?+
Total what you paid each one from your own business funds and pull their Form W-9. Payments to unincorporated vendors for services at or above the reporting threshold for that year generally require a Form 1099-NEC from you, with a deadline early in the following year. Send us the list well ahead of it and we will tell you which ones need a form.
Do you work with property managers outside Florida?+
Yes. We are in Coral Gables and work with clients nationwide, in English and Spanish. Federal rules apply the same way in every state, while state and local requirements vary. If you manage in more than one state, tell us early, because multi state situations are easier to handle before the return is built.
Let us take the tax part off your plate.
Tell us what you need and see your price. A real person on your team replies within one business day.