The legality of the finder's fee in web design/SEO services.
In this case I'm applying this situation to giving the finder's fee to an unlicensed individual for bringing in people for web design/SEO services. This might be different from real estate/insurance but then again those are the only services talked about when discussing finder's fees.
I've read a lot of things about this, but among the most common are these three.
1) You can't pay someone a finder's fee or commission to someone who is unlicensed. If a competitor finds out and reports you, you're screwed.
2) Every state has a different law regarding this. It's always best to check with your state jurisdiction. From what I read though is that Michigan and Texas are one of the few states that allow this, but with certain requirements. Texas allows it, as long it doesn't surpass $50 in cash or value (Not sure though)
3) You can somehow get around this finder's fee thing by labeling a marketing expense, you're just paying someone to advertise for you and just get a bonus if that person buys. (However law enforcement could say this is still technically a finders fee, just labeled differently)
What do you guys think of all this?
Does it really matter if the finder's fee is applied for real estate/insurance (where I know it's illegal if the fee is given to an unlicensed individual) or web design/SEO?
Have you ever used a finder's fee to help promote your services?
If it is ok to do this, can it be considered a marketing expense?
I just want to get the ball rolling.
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