Tax Topics for Real Estate Agents

Real Estate Continuing Education Course

Course Description

This course aims to provide licensed real estate professionals with the necessary knowledge to stay updated with the constantly evolving world of taxation.

The course focuses on Taxation topics that pertain to the licensee. The IRS maintains a Tax Code which is continually updated and currently has more than 6,000 pages. Because of the complexity, all licensees should advise their clients to seek tax advice from a professional accountant or CPA. The real estate agent provides general tax and investment knowledge; the CPA provides specific tax assistance and advice. However, the knowledge of tax rules directly affects consumer decision-making. Thus, taxation is an important area for real estate agents to become knowledgeable about, including applicable tax rules regarding investment property, residential owner-occupied property, and business taxation to support their work as independent contractors. In this course, we do not aim to train expert accountants, but rather to provide the basic tax knowledge expected by consumers of a licensed real estate professional to support licensee competence in their brokerage practice.

At the conclusion of the course, your certificate of completion will be immediately available online in your student account. If you have questions during the course, please post those in the Q&As. This is also a great place to see if your question has already been answered and posted online.

Course Topic

This course focuses on the following topics:
•    Taxation 
•    The purpose of the Tax Code
•    Taxation Terminology and Principles
•    Basis
•    Capital Gains and Losses
•    1031 Exchange
•    Tax principles in the sale and exchange of real property
•    Taxation Classifications for Real Property Ownership
•    Business tax implications for licensees and real property investors

Course Learning Objectives

Upon completion of this course, you will be able to:
•    Discuss the tax code and how it affects different aspects of the real estate industry.
•    Explain basic taxation and how brokers can use it to help their clients.
•    Define the meaning of marginal tax rate.
•    Describe the specific concerns for residential homeowners, owners of real estate used in a trade or business, as well as the owner of investment real estate.
•    Demonstrate how this knowledge can increase the real estate agent's commission income and investment income.
•    List the major reasons for home ownership.
•    Explain gain and basis and how the client can compute capital gain on the sale of a home.
•    Illustrate to potential clients why it is important that they seek professional advice from a CPA.
•    Summarize how purchasing a rental property for an investment can be a tax advantage.
•    Illustrate how cost recovery is used as a deductible expense.
•    Explain how income and losses are identified (passive and non-passive income).
•    Classify the three types of vacation homes and discuss their tax consequences.
•    Explain the rules and benefits of the 1031 exchange.
•    Discuss CRTs and how they can help avoid capital gains tax, increase income, and create tax deductions.

Approved States: CO