Agent Expense Reimbursement: Who Pays for What

Compliance and Liability: Avoiding Common Pitfalls in Agent Expense Reimbursement

Here are some practical tips to help you maintain compliance and avoid liability:

• Document, document, document: Keep accurate and detailed records of all agent expenses, including receipts, invoices, and explanations for each expense.
• Establish clear policies and procedures: Develop a comprehensive agent expense reimbursement policy that outlines what expenses are eligible, how to submit claims, and the timeline for reimbursement. Make sure all agents understand these policies and procedures.
• Use an accountable plan: Consider implementing an accountable plan, which can help you save on self-employment tax and reduce liability.
• Review and reconcile expense reports regularly This will help you identify and address any discrepancies or issues promptly.
• Consult with a tax professional: If you're unsure about any aspect of agent expense reimbursement, consult with a tax professional to ensure you're in compliance with IRS rules and regulations.

Tax rules, limits and rates change. Confirm current figures with the IRS or your accountant before you file.

As a small real estate business owner or office manager, you're responsible for reimbursing your agents for expenses related to their work. By staying on top of these rules and implementing a well-structured expense management system, you can save your agents money and help them manage their costs effectively, such as with real estate expense management for under $10/user (2026).

For 2026, the rate varied depending on the date of the drive. From January 1 to June 30, 2026, the rate was 72.5 cents per mile, while from July 1 to December 31, 2026, the rate increased to 76 cents per mile due to rising fuel prices.

If the drive occurred between January 1 and June 30, 2026, use the 72.5 cents per mile rate. For drives occurring between July 1 and December 31, 2026, use the 76 cents per mile rate.