Fees, commissions, and other compensation

452.19 Fees, commissions, and other compensation. (1m) (a) No licensee may pay a fee or a commission or any part thereof for performing any act specified in this chapter or as compensation for a referral or as a finder’s fee to any person who is not licensed under this chapter or who is not regularly and lawfully engaged in the real estate brokerage business in another state, a territory or possession of the United States, or a foreign country, unless the person was licensed under this chapter when the commission was earned or when the referral fee arrangement was made. (b) If a licensee is associated with a firm, all fees or commissions and any part thereof for performing any act specified in this chapter and all compensation for a referral or as a finder’s fee shall be paid to the firm. (3) (a) 1. A firm shall not accept compensation of any kind from another firm in connection with brokerage services performed as part of a real estate transaction involving a residential property containing one to 4 dwelling units. 2. The prohibition under subd. 1. applies regardless of whether the firm represents different parties, such as buyer and seller, or whether a non-listing firm is acting as a buyer’s agent, as a subagent, or in another cooperative capacity. 3. Subdivision 1. does not prohibit the payment of compensation for a referral fee or a finder’s fee as described in sub. (1m). (b) Any agreement or arrangement that violates this subsection is void and unenforceable. (4) (a) In any transaction involving a residential property containing one to 4 dwelling units, if a seller agrees to pay compensation to a firm that is not the listing firm for brokerage services provided to a buyer, the agreement must satisfy all of the following: 1. Be expressly stated in the fully executed offer to purchase or option to purchase. 2. Be signed by the buyer and the seller as part of the contract. (b) A firm that is not the listing firm may not receive compensation from a party to a transaction who is not the client of the firm unless the agreement to pay the compensation is documented in the executed offer to purchase or option to purchase. (c) A listing contract may not require or imply that a seller will pay compensation to a firm that is not the listing firm, as prohibited under par. (b), unless such obligation is contingent upon its inclusion in the executed offer to purchase or option to purchase as provided in par. (a). (d) A listing contract shall include a statement as to whether the seller authorizes the listing firm to disclose if the seller is offering compensation to a firm other than the listing firm. NOTE: This section is shown as affected eff. 1-1-27 by 2025 Wis. Act 69. Prior to 1-1-27 it reads: 452.19 Fees and commissions. (1) No licensee may pay a fee or a commission or any part thereof for performing any act specified in this chapter or as compensation for a referral or as a finder’s fee to any person who is not licensed under this chapter or who is not regularly and lawfully engaged in the real estate brokerage business in another state, a territory or possession of the United States, or a foreign country, unless the person was licensed under this chapter when the commission was earned or when the referral fee arrangement was made. (2) If a licensee is associated with a firm, all fees or commissions and any part thereof for performing any act specified in this chapter and all compensation for a referral or as a finder’s fee shall be paid to the firm. History: 1981 c. 94; 1983 a. 464; 1985 a. 128; 1989 a. 307; 2015 a. 258; 2017 a. 365 s. 111; 2023 a. 208; 2025 a. 69. Under s. 452.03, an agreement to pay a real estate brokerage commission to a person not licensed as a broker is void at its inception. Using a licensed broker who provides no actual services as a conduit for a fee to an unlicensed person does not create a co-brokerage arrangement authorized by this section. Badger III Ltd. Partnership v. Howard, Needles, Tammen & Bergendoff, 196 Wis. 2d 891, 539 N.W.2d 904 (Ct. App. 1995), 94-2531.