Going from Agent to Broker (Tax Advantages)?

[Matt N.]

Hey all -

I was curious if anyone had any guidance on this situation. I am curious if I could end up saving a lot in taxes by going from an agent to a broker. First, I was thinking about costs. Is being required to have an office where you hang licenses combined with insurance you must carry the two biggest costs? Are there any other significant costs involved if you are only planning on having 3 or 4 agents in the next 4 years? Or can I claim my home as an office even while having a few agents hang their license? 

If you do own the brokerage, which appears to be as simple as setting up an LLC and having a brokerage license, could I then shelter 50%+ of my sales commissions from self employment tax and add other people to my team?

It is my understanding that, as a business owner and using an S-Corp, you only have to claim a reasonable salary then the rest is considered a distribution sheltered from self employment tax. (e.g. You make 100k in commissions this year, your accountant can say 40k of that is your reasonable salary which you will pay 15% self employment tax on. The 60k is a business distribution not subject to employment tax.) Is this accurate or am I off-base? Would appreciate any guidance available as this is just a thought at this point that I am trying to explore further. 

Cheers!