REALTOR® Tell the Senate to reform our tax code AND protect middle-class homeowners

When a broker can pay an agent’s commission to a business entity

Translate this page
Male holding a smartphone in one hand and using a pointer finger to touch the screen with the other

04/11/2017 | Author: TAR Legal Staff

We get a number of calls from agents who want to set up a legal entity, such as an LLC, with the Texas secretary of state for tax purposes. Generally speaking, the agent wants to have his or her broker pay the agent’s commission to the entity rather than directly to the agent. This is only permissible under Texas licensing law if the legal entity is established as a brokerage entity with the Texas Real Estate Commission.

— Kelly Flanagan, legislative attorney

This is reprinted from the April 2017 issue of Texas REALTOR® magazine. Read the latest issue now.

Categories: Legal
Tags: legal, brokers, agents

Get REALTOR® blog posts via email

advertise with us

Legal disclaimer

The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on Any legal or other information found here, on, or at other sites to which we link, should be verified before it is relied upon.

Advice for REALTORS®

5 ways smart-home tech affects real estate transactions

5 apps that can keep you safe in—or before—a crisis

Is the eviction process different for manufactured homes?

3 places you can find free marketing content


More advice for REALTORS®