# Trail commission

> A trail commission is an ongoing payment to the person who sold you an investment, taken each year from the investment for as long as you hold it.

Canonical page: https://find.wellspent.co/glossary/trail-commission/
Also called: trail, trailing commission, trailer fee

In US mutual funds, trails usually come out of 12b-1 fees. FINRA lets a fund pay its brokers a service fee of up to 0.25% a year for ongoing service and account maintenance, and an asset-based sales charge of up to 0.75% a year on top.

The trail is built into the fund's expenses, so you pay it through a lower return rather than a bill, and it keeps being paid whether or not you hear from the person who sold you the fund.

Only someone registered to sell securities can receive trails, so a fee-only advisor doesn't. When you switch advisors, it's worth asking whether any fund you still hold pays a trail, and to whom.

## How to check

The fund prospectus's fee table shows the 12b-1 fee that funds most trails. Search the advisor on FINRA BrokerCheck: a current broker registration means they can receive trails, and Item 5.E of the firm's Form ADV Part 2A says whether anyone there does.

## Sources

- [FINRA Rule 2341, Investment Company Securities, paragraphs (d)(2) and (d)(5)](https://www.finra.org/rules-guidance/rulebooks/finra-rules/2341)
- [Investor.gov (SEC), Shareholder Service Fees (checked October 31, 2026)](https://www.investor.gov/introduction-investing/investing-basics/glossary/shareholder-service-fees)
- [FINRA BrokerCheck](https://brokercheck.finra.org/)

## Related terms

- [12b-1 fee](https://find.wellspent.co/glossary/12b-1-fee.md)
- [Commission-based advisor](https://find.wellspent.co/glossary/commission-based.md)
- [Fee-based financial advisor](https://find.wellspent.co/glossary/fee-based.md)
- [Expense ratio](https://find.wellspent.co/glossary/expense-ratio.md)