So after much drama and try as hard as they could to get out of it, Corcoran has agreed to co-broke with me on my purchase of a Co-op in Manhattan. I am an attorney with a NY brokers license. I further asked for a purchase price reduction rather than a commission. They refused and have insisted on writing me a check at closing and, I assume, will issue me a 1099 for the income. My lawyer is going... [more]
So after much drama and try as hard as they could to get out of it, Corcoran has agreed to co-broke with me on my purchase of a Co-op in Manhattan. I am an attorney with a NY brokers license.
I further asked for a purchase price reduction rather than a commission. They refused and have insisted on writing me a check at closing and, I assume, will issue me a 1099 for the income. My lawyer is going to try to ask Seller's lawyer directly, but I am not holding my breath since it was a major fight to even get Corcoran to do it in the first place.
I was curious as to whether anyone has been in a similar situation and whether they determined whether they had to pay income tax on the commission.
What little I was able to find on this leads to a IRS ruling (http://www.irs.gov/pub/irs-wd/0721013.pdf) suggesting that such a commission would be a purchase price reduction and not taxable as income. Regardless, I tend to think if I get a 1099, the IRS will want me to pay taxes.
Anyone have any experience on this?
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