Bookkeeping for real estate agents: a worked month with a split, a referral fee and an MLS dues payment
An agent's month of books comes down to a handful of entries: one per closing, built from the brokerage's commission disbursement sheet and booked at the gross commission, then the fixed costs like desk fees and MLS dues, then the transfers that stay off the profit and loss. Get the closing entry right and most of the month follows. Below is one made-up agent's March, entry by entry, with numbers that tie to the bank.
Marisol Vega is fictional, and so is everything that happens to her. She works at a brokerage on an 80/20 split. She pays a monthly desk fee and quarterly MLS dues on her business card, and in March she closes one buyer-side deal that came to her as a referral from an agent in another city.
What does the commission disbursement sheet say?
The buyer pays $615,000. The buyer's side of the commission is 2.5%, or $15,375.00. That is Marisol's gross commission. Before any money reaches her, the brokerage takes its cut, pays the referring agent and charges its fee:
| Line on the disbursement sheet | Amount |
|---|---|
| Buyer-side commission (2.5% of $615,000) | 15,375.00 |
| Brokerage split, 20% | (3,075.00) |
| Referral fee to the referring agent's brokerage, 25% | (3,843.75) |
| Transaction fee | (450.00) |
| Paid to Marisol | 8,006.25 |
Her bank shows one deposit of $8,006.25. If that is the only number in her books, the year's profit can still come out right, but she has no idea that this one closing cost her $7,368.75 to get paid. Over a year of closings, that is the number she needs when she compares brokerages or decides whether referral business is worth taking.
Brokerages differ in the order they work this out. Marisol's takes its 20% from the full side. Others take the split after the referral comes off. Check your own agreement and follow its order in the entry.
How do you turn it into a journal entry?
One entry, dated the closing date, with the deposit on one side and the gross commission on the other:
| Account | Debit | Credit |
|---|---|---|
| 10100 Business checking | 8,006.25 | |
| 50100 Brokerage split | 3,075.00 | |
| 50300 Referral fees paid | 3,843.75 | |
| 50200 Transaction fees | 450.00 | |
| 40100 Gross commission income | 15,375.00 | |
| Totals | 15,375.00 | 15,375.00 |
The split, the referral and the fee sit in the 50000s, cost of revenue, because they only happen when a deal closes. Desk fees and dues happen whether she closes anything or not, so they go lower, in operating expenses.
The referral line deserves a memo: the other brokerage's name and the property address. If Marisol ever pays a referral fee herself rather than through the brokerage, she should get a Form W-9 from the payee first. For payments from 2026, a 1099-NEC is due for each non-corporate payee paid $2,000 or more in the year.
Where do the MLS dues and desk fee go?
The quarterly MLS dues of $165.00 went on the business card on March 2. That is an expense now and a card balance until the card is paid:
- 60200 MLS and association dues: debit 165.00
- 20100 Business credit card: credit 165.00
The $500.00 desk fee came straight out of checking on March 1:
- 60100 Desk fees: debit 500.00
- 10100 Business checking: credit 500.00
When she pays the card from checking later, that payment is a transfer between two of her own accounts. Booking it as an expense would count the dues twice.
What did March actually earn?
| March 2026 | Amount |
|---|---|
| Gross commission income | 15,375.00 |
| Less split, referral fee and transaction fee | (7,368.75) |
| Less desk fee and MLS dues | (665.00) |
| Profit for March | 7,341.25 |
That profit figure, not the deposit, is what her estimated tax payments get worked out from. Marisol moves $2,200.00 into a separate tax savings account on March 31, roughly 30% of the month's profit. The percentage is her own habit; her tax preparer sets the real payments. The move is a transfer, so it doesn't touch the profit and loss either.
Does checking tie at month end?
This is the step that proves the entries above are complete. Marisol's March checking statement opens at $4,180.40. Run it forward:
- plus the commission deposit, 8,006.25
- less the desk fee, 500.00
- less the transfer to tax savings, 2,200.00
- less February's card balance, paid March 18, 412.30
That lands on $9,074.35, the closing balance printed on her statement. If it hadn't, the size of the gap would point at the missing or doubled line. Do the same for the card and the savings account and the month is done.
Which part takes the longest?
Not the closing. The closing entry takes five minutes once the disbursement sheet is in front of you. The slow part is everything with no paper behind it: a card charge from a February open house that nobody remembers, cash spent on signs, a client gift with no receipt, a mileage log rebuilt from a calendar in April. Agents who keep every disbursement sheet and a running mileage log rarely have a bad April.
The chart of accounts this example uses, along with the gift limit, the mileage rules and the 2026 estimated tax dates, is in our guide to bookkeeping for real estate agents.
Disclosure: I'm Damin and I run ZeraBooks, so weigh this part accordingly. Our team keeps agents' and small teams' books monthly from the bank and card statements and closing paperwork they upload through a portal, with each closing booked gross like the entry above. There's no bank feed or brokerage connection. You see the books in a read-only login and get reports on the schedule you choose. Pricing starts at $150 a month (USD) and is set after a free call; the details are on our bookkeeping services page.
Keep the disbursement sheet with the deposit. It is the receipt for your biggest income and your biggest expenses at once.
Comments
Post a Comment