Year-End CPA Handoff for Real Estate Agents: What to Send and How to Prepare It

The six pieces of a CPA-ready packet

Every preparer has their own intake process, so ask yours what they want and by when. These six items are a solid starting point:

If you operate through an LLC or S corporation, your CPA may need additional records, such as payroll reports. That depends on how your entity is taxed, so confirm it with them rather than assuming the sole-proprietor list above is complete.

Reconcile your income before you hand anything over

This is the step that saves the most back-and-forth. Your 1099-NEC is a form the payer prepares. The current IRS instructions say payers must furnish 1099-NEC statements to recipients by January 31, and that when a date falls on a weekend the due date moves to the next business day. January 31, 2027 is a Sunday, so the forms for 2026 are due February 1, 2027. Either way, the forms you need arrive early in the year. What a form reports, and how your brokerage reports it, can differ from one brokerage to another and from your own records, so treat it as one input rather than as your income figure.

A simple reconciliation looks like this:

1. List every payer: your brokerage, any referral partners, and anyone else who paid you for real estate work.
2. For each, put the amount on the 1099 (if you received one) next to the amount you recorded as received during the year.
3. Write one line explaining each difference, such as a fee deducted before payment, a payment that landed on the other side of December 31, or a payer that sent no form.

That last case matters. A missing form doesn't make income disappear. Pub 334 says to be sure to report all of your self-employment income, and the Schedule C instructions tell you to check any Forms 1099 you received for business income that belongs on line 1. If the total in box 1 of your 1099-NECs is more than the gross receipts you report, the instructions say to attach a statement explaining the difference. Having that explanation written down before your preparer asks is the point of the reconciliation note.

Timing deserves a question for your CPA. Under the cash method, the Schedule C instructions say to show all items of taxable income actually or constructively received during the year. A commission that closes in late December but pays in January is the kind of edge case to raise rather than settle yourself.

Make sure the records exist before anyone asks for them

Two categories cause the most scrambling: mileage and receipts.

Mileage. If you claim the standard mileage rate, Schedule C asks you to complete Part IV with vehicle information. The substantiation regulation requires adequate records for each element of vehicle use, and it names an account book, diary, log, or similar record as acceptable. It also says a record made at or near the time of use carries a high degree of credibility, and that a weekly log accounting for the week's use counts as made at or near the time. A contemporaneous log isn't strictly required, but a reconstruction from memory is a weaker position. Which method you use, standard rate or actual expenses, is a decision for you and your CPA, and the two methods don't stack.

Receipts and supporting documents. Pub 583 lists sales slips, paid bills, invoices, receipts, deposit slips, and canceled checks as supporting documents, and suggests keeping them organized by year and by type of income or expense. The IRS also puts the burden on you: to deduct an expense, you must be able to prove certain elements of it. Whether an expense is deductible is a tax question your CPA answers. Your books' job is to show what you paid, when, to whom, and why.

Business account hygiene. Pub 583 says you should keep your business account separate from your personal checking account and reconcile your checking account each month. It's guidance, not a federal requirement for every sole proprietor, but it makes the packet far easier to build.

How long to keep it. IRS Topic 305 says to keep records until the period of limitations for the return expires, which is generally three years from filing, with longer periods in some situations. Ask your CPA how long they recommend for your circumstances.

Questions to ask your CPA at handoff

• Does the accounting method in my books match the method on my return? (Lulu Ledger's Help Center says the app is designed around cash-basis bookkeeping and recommends asking your tax professional how your business should be reported.)
• Which vehicle method are we using, and is my mileage log what you need?
• How should I plan estimated tax payments for next year? The IRS describes this as a pay-as-you-go system, and Topic 306 explains the underpayment penalty and the safe harbors that can avoid it.
• Are there any large or unusual expenses you want documentation for beyond what's in the packet?

Where Lulu Ledger fits

Lulu Ledger is a recordkeeping and planning tool built for real estate agents. It doesn't file your return or replace your CPA, and there's no CPA portal: you print or export the report as a PDF and send it, along with any CSVs your CPA wants. Within that limit, it covers most of the packet:

• The P&L report exports as PDF or CSV, with income and expenses in agent-specific categories. The mileage deduction appears as its own line.
• Under Settings, then Data, then Export, you can download detailed CSVs for income, expenses, deals, and mileage. The Help Center describes this as the route for sharing with an accountant.
• Mileage trips are logged with date, route, and purpose, and the app offers monthly, quarterly, and year-end mileage reports.
• Receipts you upload stay in Receipts Waiting to Match until you link them to a transaction, so you can see what still lacks support before December 31.
• Estimated tax payments have their own category, Estimated Tax Payments, which Lulu Ledger keeps out of your profit. That means they won't appear on your P&L, so list them for your CPA separately.

One note for the reconciliation step: Lulu Ledger's Help Center says P&L income and deal-based commission totals can differ because they come from different records. If a number looks off, check which report you're reading before assuming something is missing. Comparing against a spreadsheet instead? See how Lulu Ledger compares with spreadsheets.

If you'd like to see your books in packet-ready shape before year-end, you can start a 14-day free trial.

Lulu Ledger is a recordkeeping and planning tool. It does not provide tax, legal, accounting, financial, or investment advice. Review your situation with a qualified professional.

Sources

• IRS, Recordkeeping (page last reviewed or updated May 1, 2026)
• IRS, Topic no. 305, Recordkeeping
• IRS, Topic no. 306, Penalty for underpayment of estimated tax
• IRS, Publication 583, Starting a Business and Keeping Records (12/2024)
• IRS, Publication 334, Tax Guide for Small Business (2025)
• IRS, Instructions for Schedule C (Form 1040) (2025 edition)
• IRS, Instructions for Forms 1099-MISC and 1099-NEC
• 26 CFR 1.274-5T, Substantiation requirements
• Lulu Ledger, Features, Help Center, and FAQ