I was wondering if anyone has any experience or advice to give about my particular situation. I made a decision to build a house in Texas (moving from the DC area). I found the house on my own-never used a realtor in the process. The day that I signed the contract, I asked the builder's sales agent if they would give me the 3% they would give to a realtor. The answer was no, but the agent told me to find one with a Texas licence and work out an arrangement with them. We called a friend of the family who is a realtor and she was enthusiastic and agreed. I go to settlement early in November and an trying to finalize everything. I am getting different information at how the realtor contribution to me is treated. For example's sake let us say the fee is $6K and she contributes $4K to me which will show on the closing document as a reduction in what I owe to the builder, does she still have to claim the full $6K for tax purposes as income to herself for which she will have to pay the income and FICA taxes on (she is self employed)? Or is it just what she actually gets from the transaction? I am trying to be fair to her and do the right thing, but also don't want to short myself either. The sales agent for the builder told me last night that essentially the realtor is on the hook for the income taxes on the full example of $6K because the contribution to me is treated as a gift. I would be grateful for any advice or information I can get.