Can Realtors Write Off Clothing Expenses?

Navigating tax deductions for business expenses can be complex, and clothing is a nuanced area. Many professionals, including realtors, often wonder if their work attire qualifies as a deductible expense. While many business expenses are deductible, the Internal Revenue Service (IRS) applies strict criteria to clothing. Understanding these criteria is crucial for anyone considering deducting work-related apparel.

General Rules for Business Clothing Deductions

For clothing to be a deductible business expense, it must satisfy two IRS conditions. First, it must be specifically required for your job or trade. Second, it must not be suitable for ordinary wear outside of the workplace. This means garments worn only for work, if suitable for personal activities, do not qualify for a deduction.

Examples of clothing meeting these criteria include uniforms with a company logo, protective gear like hard hats, safety boots, or specialized gloves, and costumes worn by performers. These items are clearly work-specific and lack general utility for everyday use. Conversely, standard professional attire like business suits, dresses, or casual wear, even if exclusively purchased and worn for work, fails the “not suitable for ordinary wear” test because such garments are adaptable for personal use. The cost of cleaning and maintaining eligible work attire, such as uniforms, can also be deductible.

Applying Clothing Deduction Rules to Realtors

For realtors, most professional wardrobe items do not qualify as a deductible expense. Standard business attire, including suits, blazers, dresses, and business casual wear, is not deductible. This is because these items are suitable for everyday use, even if worn daily for client meetings, property showings, or open houses. The IRS views such clothing as personal expenses, regardless of how exclusively it is worn for business.

While most of a realtor’s clothing expenses are not deductible, exceptions exist. If a real estate agency requires a specific uniform with a prominent company logo that is not suitable for general wear, its cost could be deductible. Additionally, if a realtor needs protective gear for specific job duties, such as a hard hat or steel-toed boots when visiting active construction sites, these items would be deductible. This is because protective equipment is not suitable for ordinary personal use and is necessary for safety.

Record Keeping for Clothing Expenses

Maintaining records is important for any business expense deduction, including the rare instances where clothing qualifies. For any potentially deductible clothing items, keep detailed records. This includes original receipts or invoices showing the date of purchase, amount paid, and a clear description of the item.

It is also advisable to keep a log documenting the business purpose of the clothing, especially for items that might be borderline deductible. This documentation helps substantiate the deduction in the event of an IRS inquiry. Proper record-keeping ensures you can support your claims and demonstrate compliance with tax regulations.