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Q:  I just concluded a transaction in which I represented a first-time home buyer.  At closing, my client expressed how happy she was with my services and gave me a thank-you note along with a $500 gift card to Amazon. Can I accept the gift card? Would I need to claim it as income on my taxes?

A:  As an agent, any commission you earn from a transaction must be paid by your principal or supervising broker. The regulation in Virginia dealing with real estate licensees accepting commission improperly is 18VAC135-20-280, which states, “Actions resulting in an improper brokerage commission include: …Accepting a commission, fee, or other valuable consideration…for any real estate services from any person or entity except the licensee’s principal or supervising broker.”

So, accepting a commission, fee, or “gift” directly from a client would be classified as improper brokerage commission. If your client wishes to give you an additional amount beyond your contracted commission, that amount likewise needs to go through your brokerage. That additional amount would then count as taxable income just like any other commission you may receive.

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