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Ray
Ray, Lawyer
Category: Real Estate Law
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Experience:  Texas Attorney for 30 years dealing in real estate
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Florida Real Estate Law Question: if someone is a licensed

Customer Question

Florida Real Estate Law Question:
Hello, if someone is a licensed real estate sales agent in Florida buying a house somewhere in Florida jointly with a sibling through another realtor ( the licensed buyer is not participating in the sales transaction as a realtor, just as a buyer) can the buyer's realtor credit commission to buyers during closing as a rebate? Can the licensed buyer participate in such a situation and what are the disclosure requirements?
Thank you
Submitted: 6 months ago.
Category: Real Estate Law
Expert:  Ray replied 6 months ago.

Hi and welcome to JA. Ray here to help you today.Please bear with me a few moments while I review your question, conduct and prepare your response.

Expert:  Ray replied 6 months ago.

The broker here under Florida law can only pay the realtor, split the commission with full disclosure.The realtor will have to claim it as income as the broker will 1099 them.The realtor can gift it here if they choose or do whatever they want with it.

But there are real estate rules that broker can only pay another realtor and there are tax implications, the broker has to show payment to the realtor tax wise .It is the only way this can be done under licensure rules and taxes.

I appreciate the chance to help you today.Thanks again.Good luck here with the closing.

Expert:  Ray replied 6 months ago.

May I share a referral fee with someone who doesn’t hold a real estate license?

A: Section 475.25(1)(h), Florida Statutes, prohibits a Florida licensee from paying a fee or compensating someone who doesn’t hold a real estate license in Florida or another state.

Expert:  Ray replied 6 months ago.

https://www.floridarealtors.org/LegalCenter/AskanAttorney/Real-Estate-License-Law-Legal-FAQs.cfm

Can only pay the realtor here under Florida law as a commission, realtor can gift it to the other party here if they choose.

Thanks again if you can positive rate 5 stars it is much appreciated.Take care.

Customer: replied 6 months ago.
Sorry I am confused, so I am going rephrase the question.Is it legal for the buyers real estate agent/broker to offer a rebate to buyers at settlement and can the buyer, who is also happens to be a licensed real estate agent in another county, accept this rebate?
Expert:  Ray replied 6 months ago.

The agent gets the commission, he has to pay taxes on it, if he wants to rebate it, gift it, whatever just know the broker here is going to 1099 the realtor because it is a paid commission.The broker under the licensure rules above can only pay a commission to the realtor.And the realtor gets the money and can do with it what they want.

This may get you to the same result but you have to follow the rules.They cannot just rebate it here, it is a taxable thing for the realtor to receive it the broker has to 1099 it off their taxes so they pay less, realtor pays taxes on it here.No way around that.

The realtor can get paid because they are a broker and its legal to do so here, with disclosure to every bodies consent. If they weren't a realtor this would not work here under the Florida rules.Even if he is a buyer here he can receive a share of the commission.

Thanks

Expert:  Ray replied 6 months ago.

It shows up ont he closing statement as a split commission between broker and realtor and is a closing cost here--not sure who is paying those.You just have to separate the one hat as realtor and other hat as buyer.As realtor they are getting the split commission.It is a great way to make down payment, I do closings this way all the time for realtors buying property with virtually nothing down.The commission they get they turn around and use it for down payment.

Expert:  Ray replied 6 months ago.

Thanks again for letting me help you today.

If you can positive rate it is much appreciated.

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