How and when will MAR be updating forms to comply with the practice changes proposed in the National Association of REALTORS® Settlement?

The MAR Forms Advisory Committee has been diligently discussing, reviewing and finalizing changes to MAR representation agreements and purchase contracts with the goals of clarity and good-faith adherence to the practice changes. 

The changes primarily include a stronger emphasis on consumer choice, evident in the finalized edits to all versions of the following forms: 

• Contract to Purchase Real Estate
• Standard Purchase and Sale Agreement 
• Exclusive Right to Sell Listing Agreement 
  • Additional Addendum: Authorization to Offer Buyer Broker Compensation 
• Exclusive Buyer Agency Agreement

UPDATED AND NEW MA FORMS COMING THE WEEK OF JULY 15th! New and updated forms have been sent to the forms providers. To access them, go to the MAR forms library. Please note it could take several days for the new forms to populate. Preview the forms here: https://www.marealtor.com/settlement/#1617201138455-183b955c-684a

Does the Landlord or Owner of a residential rental property need to complete and sign the disclosure on the lead paint Tenant Certification before the tenant does, or is it permissible to have the tenant sign the Notification and Certification first?

When it comes to affirmative owner disclosures, order of operations matters.  The lead laws necessarily require that the disclosure be signed by owner/lessor certifying for accuracy. This is the first step. If not completed and signed by the owner first, how else would the tenant know that the owner has provided true and accurate information concerning lead paint? 

The law requires that the owner must disclose, notify and provide for tenant certification prior to entering into a lease with that tenant. That being said, a best practice would be to encourage the completion of this disclosure by the owner/lessor at the time the broker contracts for the listing. 

Remember that the requirement to complete, sign and provide documents in the lead paint disclosure falls squarely on the owner/landlord. The onus on the broker is to ensure that the owner/landlord understands their obligations under the law and to facilitate compliance.

If I offer a rebate to the buyer, does this trigger a taxable event requiring my brokerage to send a 1099 to that buyer?

The IRS has ruled that a rebate or credit back to the buyer is not considered taxable income. The IRS views such commission credits as an adjustment to the home’s cost basis. As the rebate itself is not considered taxable income for the buyer, there would be no requirement to provide that buyer with a 1099.

However, do note that while the rebate itself is not taxable, the adjustment to the cost basis could have tax implications down the road for the buyer. 

Always remember, when in doubt confirm with a tax professional. 

https://www.irs.gov/pub/irs-wd/0721013.pdf

Services provided through the Massachusetts Association of REALTORS® is intended for informational purposes and does not constitute legal advice, nor does it establish an attorney-client relationship. The Massachusetts Association of REALTORS®, by providing this service, assumes no actual or implied responsibility for any improper use of responses to questions through this service. The Massachusetts Association of REALTORS® will not be legally responsible for any potential misrepresentations or errors made by providing this service. For more information regarding these topics authorized callers should contact the MAR legal hotline at 800-370-5342 or e-mail at legalhotline@marealtor.com.