Think about it

Where is the brake fluid located

In the master cylinder.

Is it supposed to leak in that area? No

I would suggest finding a shop to replace the master cylinder and blled your braking system.

Advance can get or have OE type in stock.Thats where i get all the ones I use.Rocky

Come on, do you really think that little gasket is what keeps the fluid inside the master cylinder? That is just a dust shield gasket to keep crud out. You need a new master cylinder or if that one is original it needs rebuilt. It would be safer if you let someone do the job, but watch them so you can learn how it works. The o rings inside the cylinder are shot and possibly there is pitting in the bore which chew up the o ring and let the fluid past.

No, but that's where it's leaking. I'm guessing I need to pull it and install or have installed a Raybestos MK551 kit. If I do it myself do I need any special tools?

I would get that MC off of there ASAP before the leaking fluid does anymore damage. The quick solution would be to get a rebuilt MC of the correct bore dia for your app. (I've had good luck with rebuilts & they are cheap). To keep yours I would pull the guts out of it & clean it up & check for pits as John said. To rebuild I would purchase a BRM flexhone of the right grit (removes minimal if any material & leaves an excellent finish then install the cups in the rebuild kit (when you eyeball the innards you will see how easy it is). the only thing that could hang you up here is if the bore is too worn enough so the rebuild would not last tho I'd say your chances are VG if it passes the pit inspection but on the down side if it did not then it would need to be resleeved but even if so likely you could reuse your rebuild assy that you put the new cups on as they'd still be nearly new. Just thinking out loud before I get my day started