selling house -- is it normal for us to pay gross receipts tax on commission?

Discussion in 'Budget Board' started by jofo, Jul 31, 2009.

  1. jofo

    jofo Mouseketeer

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    We are signing an agreement with a realtor to sell our house -- it says we have to pay the listing agent 6% plus gross receipts tax on that amount. Is that normal? I thought it was just 6% that was then split between the buyer & seller's agents -- didn't realize there was tax on top of that? (I'm in New Mexico if that matters.)
     
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  3. Cheshire Figment

    Cheshire Figment <font color=red><marquee behavior=alternate>Friend

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    Two parts to this.

    One is that what most states have as a Sales Tax (which is on the purchaser but collected by the seller), in New Mexico there is a Gross Receipts tax on the seller which they are allowed to separately state and collect from the purchaser.

    Two is that anything in a contract can be negotiated. If the Realtor is hungry enough, you can speciafy that any GRT on the Agent be payed by the Agent and that will be in the contract.
     
  4. mel

    mel <a href="http://www.wdwinfo.com/dis-sponsor/" targ

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    no, that is not normal....at least not where I live. They are already getting 6%, that should be all they get. Sounds like just another way for them to get more money from you! I would get another realtor that didn't charge that!
     
  5. muscarello4

    muscarello4 Mouseketeer

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    Maybe some states are different. We sold 3 houses in IL and always paid 6% flat commission (3% split to each realtor.) That seems very standard to me. NEVER paid a GRT. Sorry!
     
  6. big_red_s

    big_red_s Mouseketeer

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    It depends where you live, but I wouldn't pay it (heck, I wouldn't pay 6% either).

    I know we have a lady at work who is shopping for a house in Maryland where it's "normal" to sign a contract guaranteeing the Realtor a 6% commission no matter what. So for example the seller negotiated a 4% commission with their Realtor, she'll be on the hook for the other 2%.
     
  7. Nicolepa

    Nicolepa DIS Veteran

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    This is money that the Government gets, not the agents. It is a "sales tax" of sorts. We were taken by surprise as well when we sold our 1st house.
     

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