The New WB Forms Are Here: Part 2

One of the most significant changes in the revised WB-1 Residential Listing Contract — Exclusive Right to Sell can be found in a section that may look familiar but works very differently.

The current 2024 WB-1 Residential Listing Contract includes a Compensation to Others section. The revised WB-1 replaces that section with a new Offer of Compensation section.

Despite their similar subject matter, the two sections address different offers of compensation. The change reflects a fundamental shift in who may offer and pay compensation to a firm working with a buyer.

How does the current WB-1 work?

Under the current WB-1, the Compensation to Others section addresses compensation offered by the listing firm to cooperating firms working with buyers, such as subagents and buyer's firms.

Although the seller approves the listing firm's offer of compensation in the WB-1, it is not an offer of compensation from the seller. The listing firm makes the offer, and the seller approves it. In other words, the section reflects a firm-to-firm compensation structure.

That changes beginning January 1, 2027.

What changes under Act 69?

2025 Wisconsin Act 69 prohibits a real estate firm from accepting compensation from another firm for brokerage services in a transaction involving residential property containing one to four dwelling units. Referral fees are excluded from this prohibition.

The law does, however, provide a mechanism for a seller to pay compensation to a firm providing brokerage services to a buyer. For that payment to occur, the compensation must be expressly stated in an executed offer to purchase or option to purchase signed by the buyer and seller.

The revised WB-1 reflects that new structure.

Meet the new Offer of Compensation section

Instead of the listing firm offering compensation to another firm, the revised WB-1 asks whether the seller is offering compensation to another firm.

The seller may choose whether to make an offer of compensation to another firm in the WB-1 and, if so, the terms of the seller's offer may be included in the listing contract. A seller who does not make an offer of compensation in the WB-1 may still consider a buyer's request for compensation in an offer to purchase.

The seller also decides whether to authorize the listing firm to disclose the seller's offer of compensation.

This is an important shift: the offer of compensation belongs to the seller, not the listing firm.

The revised WB-1 also makes clear that an offer of compensation is separate from the commission the seller has agreed to pay the listing firm.

An offer is not yet an obligation to pay

There is another important piece to the new section.

A seller's offer of compensation in the WB-1 does not by itself create the seller's obligation to pay another firm.

The revised WB-1 reminds the parties that, consistent with Wis. Stat. § 452.19, compensation the seller ultimately agrees to pay another firm must be documented in the executed offer to purchase or option to purchase.

The WB-1 can document the seller's offer of compensation and the seller's authorization for the listing firm to disclose that offer. But if a buyer wants the seller to pay compensation to the firm working with the buyer, that agreement ultimately must appear in the executed offer to purchase or option to purchase.

What if the seller does not offer compensation in the WB-1?

That does not prevent a buyer from asking.

The revised WB-1 specifically alerts the seller that an offer to purchase may include a request for the seller to compensate another firm.

A seller therefore may indicate in the listing contract that the seller is not offering compensation and later receive an offer to purchase in which the buyer asks the seller to pay compensation to the firm working with the buyer.

The seller can then consider that request along with the other terms of the buyer's offer.

What does this mean at the listing appointment?

The compensation conversation with the seller is changing, and understanding who is making the offer of compensation is important. Under the current WB-1, the Compensation to Others section addresses compensation the listing firm offers to cooperating firms. The seller approves the listing firm's offer, but the seller is not making the offer.

Under the revised WB-1, the conversation instead focuses on the seller's choices:

• Does the seller want to make an offer of compensation to another firm?

• If so, what are the terms of the seller's offer?

• Does the seller authorize the listing firm to disclose the offer?

• Does the seller understand that any compensation the seller ultimately agrees to pay another firm must be documented in the executed offer to purchase or option to purchase?

The distinction between the two versions of the WB-1 is important: Under the current Compensation to Others section, the listing firm makes the offer and the seller approves it. Under the new Offer of Compensation section, the seller makes the offer.

The revised WB-1 does not simply rename Compensation to Others section. It replaces a section addressing the listing firm's offer of compensation to another firm with a section addressing the seller's offer of compensation. That seller’s offer works together with the revised offers to purchase and options to purchase, where any compensation the seller ultimately agrees to pay another firm must be documented.

The revised WB-1 is available for optional use beginning October 1, 2026, and becomes mandatory January 1, 2027. The Act 69 prohibition on firm-to-firm compensation for brokerage services in covered residential transactions also takes effect January 1, 2027.