cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Level 1

I receive commissions for residential real estate sales. My broker withholds a % of the gross commission. Bank shows the net deposit. How do I properly record that?

I want to show my gross commissions as the income I've made for the year and then show the withholdings as a line item...not sure how to record these in a way that allows me to reconcile my bank statement since it only shows the net.
2 Comments
Highlighted
QuickBooks Team

I receive commissions for residential real estate sales. My broker withholds a % of the gross commission. Bank shows the net deposit. How do I properly record that?

Thanks for posting to the Community, @userruthgracey.

 

You can record the gross commission on a journal entry and then place the withholding rate to a clearing account. That said, it will allow you to reconcile your bank statement.

 

Before creating a journal entry, make sure to consult your accountant for the process of what accounts to debit and credit for the amounts.

 

Here's how to create a clearing account:

  1. Go to Accounting on the left-side panel.
  2. Select Chart of Accounts.
  3. On the Chart of Accounts screen, click the New tab.
  4. Choose Bank for the Account Type. You may choose any detail type you want for your clearing account.
  5. Type in the Name for the clearing account.
  6. Make sure to leave the account balance as blank before clicking Save and Close.

 

For reference and details on how to make and use the journal entry feature, you can check this article: Create a journal entry in QuickBooks Online.

 

You can then reconcile the records from your bank statement and reference this article for the detailed steps: Reconcile and account in QuickBooks Online. It includes the actions on how to review and edit completed reconciliation.

 

I'll be happy to read your comment if you have anything to ask about recording transactions. I'm always here to help. Have a safe day ahead!

Highlighted
Level 4

I receive commissions for residential real estate sales. My broker withholds a % of the gross commission. Bank shows the net deposit. How do I properly record that?

You can create a sales receipt. Use an income item for the full amount of income and then on the second line use an expense item and enter the amount of the brokers fee as a negative. This will accurately reflect your income and fees paid. The sales receipt total will be the net amount to reconcile with.

Need to get in touch?

Contact us