Productivity Coach Compensation Models

The following are best practice standards for the booking of productivity coach fees. To ensure proper tax records and royalty booking, one of the following methods must be used.  These are the recommended booking procedures:

Productivity Coach is paid contract labor 100 percent by the associate:

On the transaction, a deduction is set up in the name of the Productivity Coach. The transaction is processed using the same procedures as all other deductions. The Market Center will then cut the check to the Productivity Coach, which will keep the 1099 income at the Market Center level, and the associate will not have to deal with issuing a 1099 to the Productivity Coach. This check is coded to the clearing commissions account.

The card used within AccountEdge to pay this fee shall be set up as a 1099 card so that the appropriate 1099 can be produced at year-end.

At the end of the year, a report of deductions withheld from the associate’s commissions will be distributed to the associate so that they can take the deduction on their taxes if eligible. 

The Productivity Coach is paid contract labor and the Market Center pays a portion:

A deduction is set up in the name of the Productivity Coach. Only the portion of the fee paid by the associate will be deducted from the associate’s net proceeds from the transaction. The Market Center will then cut the check to the Productivity Coach, which will keep the 1099 income at the Market Center level and the associate will not have to deal with issuing a 1099 to the Productivity Coach. This check is coded to the clearing commissions account. When entering the payment to the Productivity Coach, the portion paid by the associate is coded to the clearing commissions account, and the portion being paid by the Market Center is coded to “Expenses–Productivity Coach.”

The card used within AccountEdge to pay this fee shall be set up as a 1099 card so that the appropriate 1099 can be produced at year-end; see Enter Vendor into AccountEdge. At the end of the year, a report of deductions withheld from the associate’s commissions will be distributed to the associate so that they can take the deduction on their taxes, if eligible.

The Productivity Coach is paid through payroll, and the Market Center collects a fee from the associate:

On the transaction, the fee to the Productivity Coach paid by the associate would be booked as a deduction set up to the Market Center, and would be deducted from the associate’s net proceeds from the transaction. The deduction received from the associate is coded to “Other Income – Productivity Coaching Fees.” The Market Center then pays the Productivity Coach through payroll, with the salary of the Productivity Coach being booked to “Salaries–Productivity Coach” and any bonuses booked to “Salaries–Productivity Coach Bonuses.”

At the end of the year, a report of deductions withheld from the associate’s commissions will be distributed to the associate so that they can take the deduction on their taxes, if eligible. The Productivity Coach will receive the standard W-2 at the end of the year.

The Productivity Coach is paid through payroll, and the Market Center collects no fee from the associate

As no deductions are collected, no entries on the transactions are created. The Market Center then pays the Productivity Coach through payroll, with the salary of the Productivity Coach being booked to “Salaries–Productivity Coach” and bonuses booked to “Salaries–Productivity Coach Bonuses.”

The Productivity Coach is paid as an additional associate on the transaction

The Productivity Coach receives a portion of the commission and is added to the transaction as an additional agent. In this scenario, the Productivity Coach pays royalty on the portion of the commission they receive. It is at the Market Center's discretion as to whether or not the Company Dollar is also deducted from the Productivity Coach. The agent pays company dollar and royalty on their portion of the commission. 

Using this method does not allow the agent to claim payment to the Productivity Coach as a business expense. However, it does reduce the agent's GCI and 1099 income.