Helpful Hints for the Holidays By Laura Sanders Fowler JD and John G. Pearce JD/CPA Attorneys at Law The Fowler Law Firm PC Printer Friendly Version

Dear Readers:

Last week the following materials were presented at the Lake Travis Market Center. We received many comments and questions both during and after the presentation. Please note that our new law firm with eleven lawyers, most of whom have already had the privilege to serve the needs of Keller Williams agents and their clients, has moved across the street to 919 Congress Avenue, Suite 1150, where you and your clients are always welcome.

As the holiday season approaches, it is a great time to review one's business to decrease liability, and start off the New Year in great shape. Here is a handy checklist of things that very experienced brokers and agents often miss or don't understand, which can land them in hot water both with their licensing boards (TREC) and with other state and federal regulators.

1. Keep current on TREC-required Continuing Education, most especially Legal Update and Ethics.

Believe it or not, this is the most frequent reason that brokers' and agents' licenses are suspended. Sometimes the problem is that the provider of training failed to report the hours. Sometimes the broker or agent did not understand the type of hours for which the course counted. To avoid any of these problems, make sure that you are following TREC's records of your credit hours closely. You can do so by CLICKING HERE.

2. Make certain your marketing conforms to the requirements of the Texas Occupations Code.

When we are asked to review the 'misdeeds' of agents and brokers, we find that they sometimes (more frequently than you might imagine) have marketing that is not in compliance with state law. Please take a moment to review the Texas Occupations Code HERE, which addresses everything from signage to the characterization of your services. Failure to comply with this law carries severe penalties, including the potential revocation of your license by TREC.

3. Make certain that you are who you say you are.

Some agents and brokers do not understand that creating a company requires more than a label. True, there are elaborate rules and state laws related to marketing. For example, you can't use only an agent or sales associate's name in marketing materials when affiliated with a broker. Regardless of whether the sale is of real estate or candy canes, equally serious consequences flow from using a name to market that is not either your personal name or that of a company that has filed with the Texas Secretary of State. Not knowing what you are (i.e. a PC, an LLC, an Inc. or an Ltd.) and misstating that can also cause a whole host of problems. Please visit the Texas Secretary of State HERE for more information.

4. Make sure that providers and vendors you work with are properly registered - and have paid their taxes.

As you look at those providers and vendors you have been kind enough to refer clients to this year, you may be horrified to learn that some of them are not properly registered and/or do not pay their taxes. These are serious violations that you need to know about before you refer any of your precious clients to them, not after. You can check up on their status by visiting the Secretary of State HERE and the State Comptroller HERE. But don't get excited and pick up the phone to accuse your providers. If you do not find them, or if they appear to be in arrears on payment of the state franchise tax, call the Secretary of State and State Comptroller first. Tell them exactly why you are making the inquiry, and explain that you want to make certain there is no mistake. Your authors believe you will generally find these agencies to be extraordinarily helpful. They don't want you to make a mistake as much as you don't want to, since it is their website and database on which you are relying!

5. Capture all of the business expenses you can... THIS YEAR!

Whether you had the greatest year or the worst, there is rarely a good reason to delay claiming business expenses. If you don't have a great system right now for recording and claiming business expenses, make the creation of this a top priority. All of those little trips around town and party favors add up in a hurry and are easy to miss. In your authors' opinion, this may be the most missed source of income for beginning and top producing agents. What you don't have to pay in taxes is income every bit as much as gross commissions. For more information, please visit the Internal Revenue Service website HERE.

6. Contact your team leader at once if you think you may be headed for a crisis.

Grievances and claims against the individual agent or broker are often a cause of alarm and even shame. But don't hesitate to tell the team leader if you think one is out there and about to explode. Failing to timely report could result in you having no insurance coverage for an otherwise completely covered claim. If you aren't sure, err on the side of caution: contact your team leader and discuss it now.

7. Keep your operating funds and your clients' money separate.

Commingling your clients' money and your operating funds can land you in the penitentiary or result in your license being revoked. We all know that we shouldn't steal our clients' funds, but time and time again agents fail to maintain and properly report small sums deposited for the benefit of their clients. If the client gets mad about something, this is the first place that their lawyers will go looking. Make certain that you or the staff member who handles your clients' funds truly understands the seriousness of mistakes related to client funds. Please see Sections 535.141-161 of TREC's Rules for more information on Suspension and Revocation of Licensure, and most especially Section 535.146 Failure to Properly Account for Money; Commingling, available HERE.

We look forward to seeing many of you at this month's sales meetings and other festive occasions. We wish each of you a truly wonderful holiday season. It has been a great pleasure and honor to serve the needs of so many of you and your clients this year, and we are excited and honored that we will be able to do so in 2008 as well. To learn more about The Fowler Law Firm PC, please visit our website HERE. We invite you to stop by for a visit in our new offices at 919 Congress Avenue, Suite 1150, whenever you find yourself in downtown Austin. You are always welcome.

This information is provided by Laura S. Fowler JD and John G. Pearce JD/CPA, Attorneys at Law with The Fowler Law Firm PC. It is not intended as a substitute for careful review by legal counsel of your choosing. We would be most honored to assist you in your every real legal need. 

Contact Laura Fowler at lfowler@thefowlerlawfirm.com
or call (512) 441-1411.

Contact John Pearce at jpearce@thefowlerlawfirm.com
or call (512) 441-1411.

As with any legal issues, please consult your attorney with questions.