Tax season is a hectic time of year for many real estate agents. Not only is the spring season heating up, but most agents also have to handle filing their taxes as an independent contractor.
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The one silver lining is the possibility of getting a sizable tax refund. If you overpaid your estimated taxes for the year, the IRS will owe you money, and we’ve got a few ideas for how you can use that extra cash to improve your business and boost your income this year.
1. Create more marketing materials
A tax return may provide the extra cash you need to launch a new marketing campaign or create new marketing materials before the busy summer season.
If you want to keep more of the money in your pocket, consider online campaigns that use pay-per-click structures rather than an upfront investment.
2. Put the money toward a real estate investment
Agents who also invest in real estate can use their tax refund to purchase or improve a property. Any landlord or flipper will tell you every dollar counts so focus on improvements with high ROI.
3. Invest in CE courses
Continuing education (CE) is a necessary part of being an active real estate agent. But CE courses are also a great way to expand your skill set and grow your business.
Even if you’re years away from renewing your license, using your tax return for real estate CE courses is a sound investment.
4. Sock it away in a savings account
Markets across the country are active, but you never know when you’ll have a slow month. Putting tax refund money in a savings account gives you extra padding that makes lulls less stressful.
5. Spend it on a much-needed vacation
A tax refund is a nice bonus that may not be expected. As such, it’s discretionary income that can be used for fun and relaxation.
Much-needed time off can also be beneficial for business. Studies have shown many people are more productive after taking a vacation.
6. Make a donation
There are a lot of upsides to being philanthropic. It makes us feel good about ourselves, it counts as a tax deduction for next year, and it’s a way for real estate agents to give back and connect with their community.
7. Pay off business-related debts
Is there a balance on your business credit card that’s costing you extra in interest every month? Then use your refund to pay the debt down and save the interest for other business investments.
If you are like me, getting a tax refund is the greatest part of the tax process. Growing your business and putting that refund to good use is the best way to spend it!