agent rebate

[irvineshadow]

The agent asked me to Fill out  W9 Form.  is it normal?  I think the agent rebate is not taxable according to IRS.

I had to fill one out early on, seems normal.

Who did you have to fill out one for?  The purpose of a W-9 Form is so that the party who receives the W-9 Form can prepare a 1099.  I sure hope you weren't issued a 1099 for a commission rebate because then you have to report it as income on your Schedule C.

whoa, I'm going to have to get that straightened out with the realtor then!  Thanks guys.

 

[qwerty]

here is the redfin ruling
http://www.redfin.com/about/press/releases/pr-irs-ruling

 

[usctrojancpa]

The agent asked me to Fill out  W9 Form.  is it normal?  I think the agent rebate is not taxable according to IRS.

I had to fill one out early on, seems normal.

Who did you have to fill out one for?  The purpose of a W-9 Form is so that the party who receives the W-9 Form can prepare a 1099.  I sure hope you weren't issued a 1099 for a commission rebate because then you have to report it as income on your Schedule C.

whoa, I'm going to have to get that straightened out with the realtor then!  Thanks guys.

If the agent 1099'ed you the rebate showing it as income and you didn't report it your Schedule C, the IRS and the Franchise Tax Board will be sending you a helfty little tax bill for it.  I would get it straightened out sooner rather than later.  Sounds like there's realtors out there who could benefit from an introduction to taxes 101. 

 

[qwerty]

The agent asked me to Fill out  W9 Form.  is it normal?  I think the agent rebate is not taxable according to IRS.

I had to fill one out early on, seems normal.

Who did you have to fill out one for?  The purpose of a W-9 Form is so that the party who receives the W-9 Form can prepare a 1099.  I sure hope you weren't issued a 1099 for a commission rebate because then you have to report it as income on your Schedule C.

whoa, I'm going to have to get that straightened out with the realtor then!  Thanks guys.

sounds like you need to split your tax savings 50/50 with USC 

 

[irvinehomeowner]

here is the redfin ruling
http://www.redfin.com/about/press/releases/pr-irs-ruling

Interesting that they consider it an adjustment to the sales price of the home. That would mean you would have to adjust the basis for reporting on your own taxes when you sell (if you were a buyer)... or if you were a seller.

 

[usctrojancpa]

here is the redfin ruling
http://www.redfin.com/about/press/releases/pr-irs-ruling

Interesting that they consider it an adjustment to the sales price of the home. That would mean you would have to adjust the basis for reporting on your own taxes when you sell (if you were a buyer)... or if you were a seller.

If a rebate is only given to the buyer, it only affects the buyer.  If a rebate is given to the seller, then it would affect the seller.  Remember that there is a $250k ($500k if married) gain exemption on the sale of a residence that you has been occupied as a primary residence two out of the last five years.  So in the vast majority of cases, the rebate will never be taxed.  Your tax basis in the home is price + closing costs (excluding property taxes, insurance, origination fees, and prepaid interest) - commission rebate + renovations.  Easy peazy.