Should Washington Real Estate Agents Pay B&O Tax?

We have witnessed Washington Business and Occupation tax mistakes made by a couple of well intentioned bookkeepers/accountants, so I thought Blackbird Accouting, PLLC should address. The agent isn’t required to pay B&O tax. The broker pays the B&O tax on the full commission received (see RCW below). Most agents registered in Washington should have the status of active/nonreporting. I hate to see people pay for unnecessary preparation fees and taxes. I’m trying to keep this simple, so if you have questions about your situation, please contact us. 

Also, if you are a realtor curious if you could benefit by changing your entity type, reach out to Blackbird Accounting, PLLC and we can analyze. 

Office phone 360-433-2659

11700 NE 95th Street, Suite 172

Vancouver, WA 98682

Real estate brokerage offices are required to pay Business and Occupancy (B&O) tax on the gross commission earned by the office, including that portion that will be paid to sales staff or associates in the same office. Where the brokerage office has paid the B&O tax on the gross commission, the sales staff, or associate brokers within the same office of the broker are not required to pay a B&O tax on the shared commissions. (RCW 82.04.255)