where I have my own real estate company, the Seller pays 7% sales tax on the commission that is paid to the Realtors and the Realtors have to pay it to the state. Just wondering if you have anything like that in CA.? I see that you do not, but Sellers do pay $1.10 of per $1000 of some closing fee. That's all I needed to know - thanks.
California and Taxes are good mates down here. To answer your question, the answer is no, nor the seller or buyer pays this.......but believe me, as a broker in San Diego we are getting killed by taxes.
I believe that last year alone the realtors taxes in CA paid for the entire Solyndra solar project......lol Just kidding :-)
Sellers pay commission. They do not pay a Realtorâ€™s taxes.
As with all taxes, most states operate differently. In California we pay state and Federal Income taxes, however, we are familiar with states that charge a sales tax on Real Estate and service income.
All the best to you,
Mark & Kari Shea
Shea Real Estate
Home Sales Specialists; New and Resale Homes
Property Valuation Specialists
Land Sales, Acquisitions & Consulting
Serving Greater San Diego
We definitely pay income tax on our commissions, but the commission is paid to your broker, who in turn gives you your cut. Sales tax is a whole other tax, and brokers don't charge or pay that, unless they're selling merchandise or some other thing that you'd add a sales tax to. Agents get a 1099 at the end of the year instead of a W-2. You get your commission from your broker or directly from escrow.
Cory La Scala
Realtors are typically 1099 self-employed and we tax income taxes on our yearly earnings.
The typical scenario is the Listing Agent Charges the Seller a 6% fee for Selling the property and
the Listing Agent splits the fee with the Selling Agent- aka Buyers Agent/Cooperating Broker.
David R. Indermill
Re/Max Hall Of Fame
Re/Max Associates La Jolla
George Samuels, Realtor
Realtors are self employed, their commissions received and earned is their declared and reported gross income, no closing / no sale no income!
Realtors pay their own income taxes based on their states......
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We are self employed. Our commission is our gross income and is reported to us in the form of a 1099-Misc. from the Brokerage. We don't pay sales tax on commission in the State of California nor do we charge or pass on any tax to the buyer or seller.
Simply The Best Real Estate Co., Inc.
No, we do not pay sales tax, we pay income taxes. I cant speak for other Realtor's but I do not charge buyers or sellers any taxes. In fact, buyers in most instances do not pay ANYTHING to their agents! As a selling agent (the buyer's agent) I do not charge a thing! The listing agent is who "charges" their sellers a fee for their commission and it is the listing agent who pays the buyer's agents commission. Hope this answers your question!