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I am a REALTOR and I am doing my taxes. I have a commission…

I am a REALTOR and...
I am a REALTOR and I am doing my taxes. I have a commission split with my broker. Can I write the portion I split with my broker off on my taxes at all?
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Answered in 4 minutes by:
1/19/2018
Lev
Lev, Tax Preparer
Category: Finance
Satisfied Customers: 33,258
Experience: Personal Investment, Tax Preparation
Verified

Yes - you may deduct fees paid to the broker.

When you make such payment - you need to report that payment on form 1099misc - assuming you pay more than $600 per year.

Then on your tax return - you will deduct that payment as your business expense.

I will help you with reporting if needed.

Let me know if you are filing schedule C for your business operations.

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Customer reply replied 6 months ago
Thank you. I am using an online tax software product filing schedule C. So then my broker should be sending me a 1099?So, I see there is a line for business expense. But would this be commission split payment paid to my broker be entered in the box "commissions and fees" paid to an agent?

When you are a payer - that is you who will need to file form 1099misc.

On your schedule C - you will deduct these payments as commissions and fees as you suggested - that is correct line.

You will need to file form 1096 as a transmitter and attach form 1099misc to it.

See instructions

https://www.irs.gov/pub/irs-pdf/i1099msc.pdf

File Form 1099-MISC, Miscellaneous Income, for each person in the course of your business to whom you have paid during the year:
At least $600 in:
2. Services performed by someone who is not your employee (including parts and materials), box 7;

You may get blank forms in any office supply store or may order from the IRS.

You may file online - but will need to use a service provider - usual fees are between $3 and $10

Due dates.

Furnish Copy B of this form to the recipient by January 31, 2019.

File Copy A of this form with the IRS by January 31, 2019,

So - you still have some time.

Lev
Lev, Tax Preparer
Category: Finance
Satisfied Customers: 33,258
Experience: Personal Investment, Tax Preparation
Verified
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Category: Finance
Satisfied Customers: 33,258
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Experience: Personal Investment, Tax Preparation

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