Realtor gets 1099 but rebated half of that back to client as fee reduction. How is it reported to avoid tax?
I asked an earlier question for my parents who were my clients that I rebated the commission money to. I got a 1099 for a real estate commission on their home purchase. I rebated a large amount of that back to the clients as a fee reduction. How do I report this on my tax return to reduce the amount rebated from my gross income and not end up having to pay self employment and income tax on money that I essentially never received?
Public Comments
- I'm not totally sure, but I think you should report the whole amount as income and the rebated amount as an expense. Your parents, if they had to report a gain, would reduce the commission paid by the amount of the rebate.
- Without researching the fact family is involved, I would list it on my Schedule C as an expense. Commission Rebate -$XXXX
