Reporting real estate commissions on 1099

RMARosie · ‎January 25, 2022

We are preparing 1099-NEC forms for agents of a real estate broker. When the commission ($5,000) is paid the broker deducts expenses ($250), such as a desk fee, from the gross commission. Thus the agent receives a net check ($4,750). When we map the accounts Commission paid is mapped as a reportable 1099 expense, not the desk fee (an income acct). Yet the system is showing the $4,750 as the reportable amount.

We all agree that the gross commission should be reported.

How do I map or set the system to only pick up the figures from the commission paid account not the net amount of the check?

Or are we incorrect is reporting the gross? Should we report the net?

Thank you for your input.

CharleneMaeF · ‎January 25, 2022

I recognize how important it is to accurately track the commissions on 1099, RMARosie. I'm here to help you with that.

The gross revenue is the reportable amount in QuickBooks. If 1099 shows the net, you'll need to know the gross before the expenses were taken out and add that as your income. You can then add the expenses after.

Also, please make sure that the accounts are correctly mapped. Then, delete and recreate the transactions to trigger the system to show the correct amount.

Aside from that, I'd suggest reaching out to an accountant to ensure the 1099 reporting is organized and accurate. If you don't have any, you can visit our Find an Accountant page to find one.

Additionally, I've included an article that'll help you learn more about preparing and filing the 1099 form. This ensures everything is accurate for the tax season: Get Answers to your 1099 Questions.

I'm only a few clicks away if you need assistance in managing your 1099 form, RMARosie. It's always my pleasure to help you out again.

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