Tax ramifications if buyer pays seller's real estate commission cost?

Forum|Forum|2 years ago
December 6, 2023
1 reply
11 views

Hello,

If the buyers agrees to pay the seller's agent commission as part of a home purchase negotiation, are there any taxable ramifications to either party?

Thank you!

Dawn

ProSeries Basic

This topic has been closed for replies.

Best answer by BobKamman

Buyers don't tell sellers how to spend the money they are paid. They can say that's what they are doing in a negotiation, but they might as well be telling the sellers to paint the dining room blue. Buyers use contract price to figure basis, sellers use it to figure proceeds. No tax consequences to what they call it.

BobKammanAnswer

Level 15

Buyers don't tell sellers how to spend the money they are paid. They can say that's what they are doing in a negotiation, but they might as well be telling the sellers to paint the dining room blue. Buyers use contract price to figure basis, sellers use it to figure proceeds. No tax consequences to what they call it.

SensibleandHourlyAuthor

Level 6

Thank you, Bob, for confirming what I thought I knew. A client reached out to me as their agent advised them to consider possible tax ramifications if they accepted a counter-offer that included the requirement that the buyers pay the sellers agent commission. Not sure what that agent was referring to. 🤔 🤔

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