Real estate agents drive for a living and rarely get paid for it: showings across three counties, listing appointments, inspections, walk-throughs, closings, and the weekly brokerage meeting. Almost every agent is an independent contractor paid on Form 1099-NEC by the brokerage, which means that driving is deductible on Schedule C — 72.5¢ per business mile at the 2026 IRS rate. An agent logging 16,500 business miles is deducting $11,963. The agents who lose that money aren't the ones who don't drive; they're the ones who don't log.
Which agent drives count
Business miles are miles driven for the business of selling real estate. For an agent, that's:
- Showings — from the office, a previous showing, or a client's home to the property, and between properties on a tour.
- Listing appointments and CMAs — meeting sellers, previewing comparable homes.
- Open houses — including the trip to set out signs and pick them up afterwards.
- Inspections, appraisals, and walk-throughs — every visit to a property under contract.
- Closings — the title company, the attorney's office, the lender.
- Brokerage meetings, training, and continuing education — when they're in a location other than your regular office, or from your office to them.
- Driving clients in your own car to tour homes — business miles, and a reason the log matters even more (passengers change nothing about deductibility, but they do make the purpose obvious).
- Marketing errands — the print shop for flyers, the sign supplier, a photographer's studio.
Which miles don't count — and the home-office rule that changes it
The IRS's general rule: driving between home and your regular place of work is personal commuting, even for the self-employed. For an agent who works out of a brokerage office, the drive from home to that office each morning — and home at night — is commuting, and so is a first-thing-in-the-morning drive from home to a showing if the brokerage is your principal place of business.
Most agents can change that with a qualifying home office. If you have a space at home used regularly and exclusively for the administrative work of your business (contracts, marketing, lead follow-up — the work agents do at home anyway), and you have no other fixed location where you do substantial administrative work, your home can be your principal place of business. Then trips from home to any work location — the brokerage office included — are business miles. That single fact routinely moves 1,500–3,000 miles a year out of the commuting column. It's fact-specific; confirm it with your tax professional, and keep the home office genuinely exclusive.
Still personal, home office or not:
- Personal errands squeezed between showings.
- Looking at property for yourself — a house you might buy is not a listing you might sell.
- Miles reimbursed by the brokerage under an accountable plan — you can't deduct what you were repaid tax-free.
Worked example — full-time agent, 2026
Dana closes about 20 transactions a year and logs 16,500 business miles: showings and buyer tours, listing appointments, inspections, closings, open-house setups, and weekly office meetings. Downtown showings and closings added $210 in parking.
Mileage: 16,500 × 72.5¢ = $11,963. Plus $210 = $12,173 total vehicle deduction — roughly $3,650 kept at a combined ~30% income + self-employment tax rate. With a qualifying home office, the 2,000 miles she drives from home to first appointments and the office become business miles too: another $1,450.
Standard mileage or actual expenses?
Agents often drive newer, nicer cars — clients notice — which is the one profile where the actual expense method (real costs × business-use percentage, including depreciation) can beat the standard rate. It also needs the same mileage log, because the business-use percentage comes from it. Two rules: to keep the choice open, use the standard rate (72.5¢) in the car's first year of business use; and on a leased car the standard rate is a commitment for the whole lease. Track everything and let your preparer run both.
Commission income makes the log worth more. Agents are taxed as self-employed: income tax plus ~15.3% self-employment tax on net profit. Every deductible dollar saves both, so each 1,000 business miles is worth roughly $200–300 in cash depending on bracket. If you'll owe more than $1,000 for the year — most active agents — the IRS expects quarterly estimated payments, and the mileage deduction lowers those too.
The IRS substantiation checklist for agents
Vehicle deductions sit under the strict substantiation rules of §274(d): the deduction is only as good as the record. For an agent, "adequate" looks like:
- ☐ Every trip with date, miles, destination, and a specific purpose — "Showing, 14 Elm St, Nguyen buyers" survives an audit; "showings" alone invites questions
- ☐ Entries made at or near the time — daily or weekly at worst, never rebuilt from the MLS calendar the following April
- ☐ January 1 odometer for each car, every year
- ☐ Year-end totals per vehicle: total / business / commuting / other (Schedule C Part IV)
- ☐ Corroboration on file: showing-service records, calendar appointments, closing statements, and the brokerage 1099-NEC
- ☐ If claiming the home-office effect on commuting: the home-office deduction itself (Form 8829) claimed consistently, with the exclusive-use space documented
- ☐ Parking, tolls, and client-tour expenses kept as separate receipts
How Mile handles an agent's week
Agents already know where they went — the problem is capturing it when the day is showings back-to-back. Mile records every drive automatically, and named places do the labeling: mark your home, the brokerage, and active listings, and each drive reads "Home → 14 Elm St" instead of a pair of addresses. Tag drives by client or transaction so a closing file has its own mileage; a rule can classify every drive during your working hours as business automatically; and a commute adjustment keeps the home-to-office legs honest until your home office qualifies. The year-end CSV/PDF export gives your CPA every trip with the four required fields, the rates used, per-vehicle business use %, and the January 1 odometer block. Free for 40 automatic drives a month, ad-free on every plan.
Sources
- IRS, Publication 463 — Travel, Gift, and Car Expenses (commuting; office in the home; Chapter 5 recordkeeping)
- IRS, Publication 587 — Business Use of Your Home (principal place of business, administrative activities)
- IRS, Topic No. 510 — Business use of car
- IRS, Notice 2026-10 — 2026 Standard Mileage Rates
- IRS, Schedule C instructions — Part IV, Information on Your Vehicle