BIC TIP #1136: Get Paid to Your LLC
It is a smart instinct. A broker wants a clean place to keep business income separate and track every expense, so they ask: can I just have my commissions paid to my LLC? Stephen Long says yes, there is a way to do it. But there is one rule that does not bend: in North Carolina, no entity without a firm license can be paid commission income. That includes your LLC.
Option One: The Full-Blown Firm
If you plan to market the name of your LLC to the public, or you plan to employ or affiliate any other brokers or other persons, you are running a real estate firm. That LLC needs a firm license, and it needs a broker-in-charge.
This is the path for brokers who want to build a brand, hang a sign, and grow a team. It comes with the responsibilities that go along with running a firm.
Option Two: The Silent LLC
Stephen describes a second option he calls the silent LLC. This entity exists solely to receive your commissions and manage your taxes and expenses. You are not marketing it. Nobody else is working under it. The public never sees its name. It is just a financial home for your own business.
Because the silent LLC is not advertising and is not employing anyone, the question of whether it needs a broker-in-charge is answered differently than it is for a full firm. Your accountant may love this setup for its record-keeping benefits.
The Non-Negotiable: A Firm License
Here is what both options have in common. Whether your LLC is loud or silent, it must hold a firm license to receive commission income in North Carolina. A sponsoring firm cannot simply cut a commission check to an unlicensed entity, even if you are the only member.
The only real difference between the two paths is whether the LLC also needs a broker-in-charge. Before you file anything, talk to your broker-in-charge about how your firm handles payments to an agent’s entity, and consider looping in a tax professional to decide which structure fits your goals.
The Practical Takeaway
You can get paid to your LLC, but only if that LLC holds a firm license. If you will market the LLC’s name or bring on other people, it also needs a broker-in-charge. If it is simply a silent vehicle for your own income and expenses, it still needs the firm license. Get the licensing right first, and then enjoy the tidy books.
