What does a real estate agent with $200K GCI keep after tax, and what changes it?

The IRS treats a licensed real estate agent as self-employed for federal tax when substantially all of the pay is tied to sales rather than hours and a written contract says the agent isn't an employee (IRS, February 2026). Your profit goes on Schedule C and carries self-employment tax as well as income tax.

Self-employment tax is 15.3%, made of 12.4% for Social Security and 2.9% for Medicare (IRS, June 2026), charged on 92.35% of your net earnings from self-employment (IRS, September 2026). The Social Security part stops at US$184,500 of earnings for 2026, and an extra 0.9% Medicare tax starts above US$200,000 for a single filer (IRS, July and September 2026), so neither limit touches the US$150,000 example. You deduct half of the self-employment tax when you work out income tax (IRS, September 2026).

For 2026 the standard deduction for a single filer is US$16,100, and income tax rates run from 10% to 37%, with 24% starting above US$105,700 of taxable income (IRS, October 2025).

The qualified business income (QBI) deduction is worth up to 20% of your qualified business income (IRS Form 8995-A instructions, April 2026). Some service businesses can lose it at higher incomes, but the IRS's definition of one of them, brokerage services, excludes real estate agents and brokers (IRS, April 2026). At or below US$201,750 of taxable income before the QBI deduction, for a single filer in 2026, the limits based on wages paid and property don't apply (IRS Revenue Procedure 2025-32, October 2025, and Form 8995-A instructions, April 2026). In every column the deduction is capped at 20% of taxable income before the deduction, because that is the smaller figure (IRS Form 8995-A instructions, April 2026).

As a self-employed agent, you pay both the employee and the employer share of the Canada Pension Plan. For 2026 that is 5.95% twice on earnings between C$3,500 and C$74,600, a maximum of C$8,460.90, plus 4% twice on earnings from C$74,600 to C$85,000 for the second additional contribution (CPP2), a maximum of C$832 (CRA, October 2025).

You claim a tax credit on 4.95% of the base contributions and deduct the other 4.95%, the 2% enhanced part and all of your CPP2 (CRA, December 2025).

Federal rates for 2026 run from 14% on the first C$58,523 of taxable income to 33% above C$258,482 (CRA, June 2026). The federal basic personal amount is C$16,452, shrinking toward C$14,829 once net income passes C$181,440 (CRA, January 2026).

Provincial or territorial income tax applies on top of federal tax (CRA, June 2026), and it differs by province, so the table stops at federal tax. A self-employed agent whose residence is Quebec pays Québec Pension Plan (QPP) contributions in place of the CPP (CRA, December 2025), so check its rates if you live in Quebec.

In the US you pay during the year. You generally must make estimated payments for 2026 if you expect to owe at least US$1,000 after withholding and credits, and the target is the smaller of 90% of this year's tax or 100% of last year's, which becomes 110% if last year's adjusted gross income was over US$150,000 (IRS Publication 505, April 2026). The usual due dates are April 15, June 15, September 15 and January 15 of the next year (IRS Publication 505, April 2026).

In Canada you pay by instalments for 2026 if your net tax owing is more than C$3,000 (C$1,800 in Quebec) this year and in either 2025 or 2024, on March 15, June 15, September 15 and December 15 (CRA, January 2026).

For GST/HST, you must register once your taxable supplies pass C$30,000 in a single calendar quarter or over four consecutive calendar quarters, and a registered real estate agent charges and remits GST/HST on commission (CRA, June 2026). The GST/HST you collect is remitted to the CRA, so it isn't part of the profit in the example.

A deductible expense lowers profit. In the US that cuts both self-employment tax and income tax; in Canada it cuts income tax, and CPP as well while your earnings are under the C$85,000 CPP2 ceiling (CRA, October 2025). The IRS allows business expenses that are ordinary and necessary in your field (IRS Publication 334, April 2026), and the CRA allows any reasonable current expense you incur to earn income (CRA guide T4002, April 2026). In the US$150,000 column, each extra US$1,000 of deductible cost cuts federal tax by about US$305; in the C$150,000 column it cuts federal tax by C$260, because CPP is already at its maximum (our arithmetic on IRS and CRA 2026 rates, October 2025 and June 2026).

US retirement contributions work differently. A SEP or solo 401(k) contribution for yourself is deducted on Schedule 1, line 16 (IRS Publication 560, April 2026), so it lowers income tax, while self-employment tax is still figured on your full Schedule C profit. In the US$150,000 example a SEP could take about US$27,881, using Publication 560's 20% rate for the self-employed and the 2026 limit of US$72,000 (IRS, April and June 2026).

In Canada, an RRSP contribution is deductible up to your limit: for 2026, new room of 18% of your 2025 earned income up to C$33,810, plus unused room, less any pension adjustment (CRA, January 2026 and December 2025). In the C$150,000 column, each C$1,000 you deduct cuts federal tax by C$260 (our arithmetic on CRA 2026 rates, June 2026). The account rules for both countries are on How do real estate agents save for retirement without a 401(k)?

An LLC on its own changes nothing on your federal income tax. A single-member LLC is disregarded for income tax unless it elects to be treated as a corporation, and an individual owner reports its activity on Schedule C (IRS, July 2026).

An S corporation election changes how the money is labeled. The corporation must pay you reasonable compensation as wages before it makes other distributions to you, and the IRS can reclassify distributions as wages, which carry employment taxes (IRS, March 2026). Whether that saves anything depends on what a reasonable wage is for your work, so work out your own numbers before you elect.

Before you form a company, ask your broker and your state's real estate commission whether your commissions can be paid to it. In Canada, ask your provincial regulator whether your commissions can be paid to a corporation before planning around one.