Atlanta Real estate brokerage firm accountants

Real Estate Brokerage Firm Accounting & Tax Planning Fundamentals

It might seem like real estate brokerage firm bookkeeping should come easily to you because juggling a million different tasks at once is second nature. After all, a large number of brokers manage complicated details that go into contracts, client relationships, marketing, vendor relationships, and employee development every day. A good real estate brokerage firm accountant may tell you that real estate brokerage firm bookkeeping requires special attention. So, let's look at how optimizing real estate brokerage firm tax planning and accounting makes your firm more dynamic.

The Breakdown: Polished Real Estate Brokerage Firm Accounting

A perfect formula for real estate brokerage firm accounting may exist. The best part is that you’ll have more time and better resources once you discover and implement it. Here's a look at the blueprint from our real estate brokerage firm financial advisers here at Fusion CPA:

  • Accurate business records. These records should be reviewed monthly with help from a real estate brokerage firm CPA or adviser

  • Goal-tracking standards

  • Automation of accounting processes whenever possible

  • Cloud-based, integrated accounting software for accounts payable, accounts receivable, payroll, and tax reporting

  • Clear data classification using separate ledgers for debt, income, and payments

  • Deduction-minded real estate brokerage firm tax planning

A single day in the life of a broker may be broken down by what looks like dozens of opportunities for deductions if you know where to look. Yes, most people are aware that miles traveled can count toward tax deductions. However, even the car that a broker drives can be a deductible item if it's used for business at least 50 percent of the time. It's really important to sit down to reevaluate deductions every few years because deductions and eligibility change. IRS tax codes are always evolving. There are many new opportunities for reducing taxable income on the table today that didn't exist a few years ago.

Commission Payment Is Part of Accounting

It's common for brokerage firms to track commissions separately from accounting. This blunder may be a huge waste of time, resources and increases the odds of data-entry errors. Integrating commissions tracking into an accounting platform provides instant transparency and accountability. This may become even more important if you have several agents working for you because waiting for commissions to be processed apart from your automated workflow might make it difficult to know how much to set aside after closing. Thus, timely commission payments should be essential for motivating agents to get deals closed.

Could Your Real Estate Brokerage Firm Be More Competitive?

A better bookkeeping plan might give you a "bonus" on every deal you close. That's because you may be spending less time and money to close the same deal. At Fusion CPA, we offer real estate brokerage firm financial services to help small, medium, and large firms become more profitable. We offer to help you make a plan to grow in your specific market through better processes, planning, and high-quality accounting software. Our services cover a wide range of financial management services including tax planning for real estate brokerage firms, accounting, bookkeeping, and CFO business advisory. A large number of our real estate clients are pleasantly surprised to discover that simple strategy upgrades allow them to identify loss points, reduce tax liability, and more. You can learn more about our services by clicking the button below to schedule a complimentary discovery call today!

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This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.