A bill championed by Tennessee REALTORS® was signed by Governor Lee. The new law clarifies that a real estate licensee can receive commission checks through a corporate entity, such as an LLC, rather than made out to the licensee individually.
The law requires the corporate entity to be solely owned by the licensee; however, the corporate entity is not required to be licensed or registered with TREC. Payment would still have to come through an affiliate broker’s principal broker pursuant to Tenn. Code Ann. §62-13-312(b)(11).
This will help real estate licensees alleviate their tax burden if they choose to take advantage. Talk with your accountant to see if setting up a corporate entity is the right decision for you.
Read more legislative news in the Vote. Act. Invest. section below. A full copy of the rules can be viewed online at:
The proposed rule is an amendment to the advertising rules set forth by the Commission. The rule amends one of the general principles. Previously, the rule required licensees to obtain written permission from the owner to advertise the property listed by another licensee. Now, the rule requires this authorization to come from the listing agent or listing broker.
A full copy of the rules can be viewed online at:
As an experienced Tennessee real estate licensee, you're probably quite familiar with the rules surrounding real estate advertising. However, TREC continues to see numerous violations in this area, so be sure to know and comply with every requirement. This includes the highlights covered in previous lessons specific to advertising. You'll find some repetition of these rules in this unit, simply to ensure there's no misunderstanding. In this unit we'll focus on four main areas:
A full copy of the unit can be downloaded. Click below:
NAR posted the latest information on the class action DOJ v. NAR lawsuit, which centered around the Sherman Antitrust Act and Restraint of Trade, primarily based on commission structures.This link will provide you with the details from NAR so far. It is important you read this information and understand what will be ultimately decided, and how you will need to comply.This is a turbulent time and keeping informed will be the only way you can stay at the ready to keep your business plan updated and your practices within the confines of the state and federal law, MLS regulations and the Code of Ethics.
Rules of the Tennessee Real Estate Commission
Click link below to go to the website for full details on TN Rules.
Click here to go to page with specifics :
TREC has reported the highest number of violations they see annually are within the Advertising section. Locally, we get calls as well regarding potential Article 12 violations, which we call the "True Picture" article.
Please make sure you review the following and that, especially watch who you advertise on a team, as this has been a sore spot apparently. If you advertise with people who are not licensed, it must say what they do on the team specifically, and all of the team are not licensed, then you must identify them accordingly. (i,e, Transaction Processor, Receptionist, Clerk, Photographer, Loan Processor, Home Inspector, ect.)
RULES OF CONDUCT CHAPTER 1260-02 (Rule 1260-02-.12, continued) : (c) Any advertising which refers to an individual licensee must list that individual licensee’s name as licensed with the Commission. (d) No licensee shall post a sign in any location advertising property for sale, purchase, exchange, rent or lease, without written authorization from the owner of the advertised property or the owner’s agent. (e) No licensee shall advertise property listed by another licensee without written authorization from the property owner. Written authorization must be evidenced by a statement on the listing agreement or any other written statement signed by the owner. (f) No licensee shall advertise in a false, misleading, or deceptive manner. False, misleading, and/or deceptive advertising includes, but is not limited to, the following: 1. Any licensee advertising that includes only the franchise name without including the firm name; 2. Licensees who hold themselves out as a team, group, or similar entity within a firm who advertise themselves utilizing terms such as “Real Estate,” “Real Estate Brokerage,” “Realty,” “Company,” “Corporation,” “LLC,” “Corp.,” “Inc.,” “Associates,” or other similar terms that would lead the public to believe that those licensees are offering real estate brokerage services independent of the firm and principal broker; or 3. Any webpage that contains a link to an unlicensed entity’s website where said entity is engaged or appears to be engaged in activities which require licensure by the Commission.