Published October 9, 2026 · Recalde & Friedman, PLLC
Headline split vs. effective split
The split a brokerage advertises tells you how one commission check is divided. Your effective split is what you actually keep over a year, after every fee, divided by your gross commission income (GCI):
Items to put in the worksheet
| Cost item | How it usually works | What to ask |
|---|---|---|
| Company split | A percentage of each commission retained by the brokerage. May be graduated (improves as you produce). | Is it per deal or reset annually? What are the tiers? |
| Cap | A maximum the company keeps in a 12-month period. After it's reached you keep more of each check. | When does the cap year start: calendar year or your anniversary? Do team splits count toward it? |
| Post-cap fees | Some models charge a per-transaction fee even after the cap. | Is there a second "cap" on post-cap fees? |
| Transaction fees | A flat fee per closed side, sometimes paid by you, sometimes charged to the client. | Who pays it? Is it disclosed to the client? |
| Monthly or annual fees | Desk, technology, board or administrative fees. | Are they charged even in months with no closings? |
| Royalty or franchise fee | Franchised offices may pay a percentage to the franchisor, sometimes passed through to agents. | Is it capped? Is it on top of the split? |
| Errors & omissions (E&O) | Per-transaction or annual premium. | What is the deductible and who pays it on a claim? |
| Lead or referral fees | Leads from a team, the company or an outside lead program often carry a larger share. | What share applies to company-sourced deals, and does it count toward the cap? |
| Your own costs | Marketing, signs, photography, MLS and association dues. | Which of these, if any, does the brokerage provide? |
Hypothetical worksheet
An agent expects 9 closed sides averaging $10,000 of commission each, so GCI is $90,000. Three of those sides come from company-provided leads. The offer being evaluated:
- 80/20 split (agent/company) on self-sourced deals, with a $15,000 annual cap;
- a 35% lead fee on company-sourced deals, which does not count toward the cap;
- $250 per transaction after the cap; $90 per month in fees; $100 E&O per side.
| Line | Amount |
|---|---|
| Company split on 6 self-sourced sides (20% × $60,000 = $12,000, under the $15,000 cap) | $12,000 |
| Lead fee on 3 company-sourced sides (35% × $30,000) | $10,500 |
| Post-cap transaction fees (cap not reached) | $0 |
| Monthly fees ($90 × 12) | $1,080 |
| E&O ($100 × 9) | $900 |
| Total paid | $24,480 |
| Agent keeps ($90,000 − $24,480) | $65,520, an effective split of about 72.8% |
The headline "80/20 with a cap" became about 73/27 for this agent, mostly because of the lead fee. That isn't necessarily bad. Those three deals might not have existed without the leads. The point is to compare like with like. Run the same worksheet for each offer at your realistic production, and at a lower and a higher year.
Don't forget what the fees buy
A lower effective split can still be the better deal if it comes with training, leads, transaction coordination or a brand that wins listings. The cheapest model is not automatically the best. See the side-by-side table in choosing a brokerage.
Frequently asked questions
What is an effective split?
It is what you keep after all brokerage, team and lead-source costs for the year, divided by your gross commission income. It lets you compare different fee structures on the same basis.
Does hitting a cap mean I keep 100%?
Not always. Many capped models still charge per-transaction or annual fees after the cap. Some lead or team splits don't count toward the cap at all.
When does a cap reset?
It depends on the brokerage. Some use the calendar year and others use your join anniversary. Ask, because it affects when in your year you reach the cap.
Related articles
- How Revenue Share Works at a Real Estate Brokerage
- Joining a Real Estate Team vs. Going Solo
- Changing Brokerages in Florida: The License Transfer Steps
- What a New Florida Licensee Should Look for in a First Brokerage
Also useful: Choosing a brokerage · Doc stamp calculator
Last reviewed October 2026. Laws change; confirm current law before relying on this page.