Open enrollment season is upon us and at CBRE this is especially important. Now is the only time of the year that you can elect to have a different compensation method. Many brokers have the choice between W-2, QREA Individual, and QREA Corporation. Download our white paper to learn more about your choices.
How you are compensated as a CRE broker will create unique challenges and opportunities for you to navigate. A strong foundation and support from an experienced team will lead to a significant cumulative affect over time.
Forming an entity is likely the best structure to have in place for receiving income. Decisions about wages, taxes, insurances, retirement accounts, business expenses and more will be your responsibility every year. As income and other variables change each year, so should your thought process for how to incorporate those changes in your strategy.
Many decisions will affect others. Each year is not independent of itself, and no single variable should be looked at in isolation. When and how to implement certain strategies is part of a long-term plan to ultimately help you reach your financial goals.
Forming an entity that is taxed as an S Corp creates a new tax return to file. Paying yourself wages that constitute reasonable compensation is now required and will change as does your income. Income and payroll tax withholding and estimated tax payments have due dates and different forms to file.
There are many different retirement accounts that can be used. How much can be contributed pre-tax can be different with each type of account. Different due dates for contributions exist as well. Business-related expenses can be tax deductible. Medical and other insurances will need to be evaluated.
Moisand Fitzgerald Tamayo, LLC and For CRE Brokers advise commercial real estate brokers at many brokerage firms throughout the country. This specialization began more than a decade ago with two brokers from CBRE. While each person’s financial planning needs are unique, many commonalities exist among those sharing the same career and brokerage firm.
We advise and help manage opportunities and strategies for many very successful CRE brokers throughout the country. We’ve developed a process for organizing the decisions they need to make every year and advise them on how to manage cash flow. What was once infrequent communication from an accountant is now high attention from us to a broker’s needs and changing circumstances.
You are likely the only CRE broker your accountant and financial advisor are working with. Don’t let their learning curve come at your expense. This guide is intended to make you aware of many of the challenges and opportunities you will have as 1099 paid CRE broker. If you really want it done well, then hire us. The tax savings from optimizing your situation is meaningful and immediate but over time the cumulative effect is significant.
The biggest decision you will have to make is whether you should try to do this on your own or hire an experienced team. Download our white paper that details all these decisions and opportunities.
