Are you thinking of forming a limited liability company or corporation as a real estate salesperson, associate broker or team?   Before you file, make sure that you comply with these Rhode Island real estate regulations. 

DO’S

▪The entity can be wholly owned by a maximum of one person as a member of an LLC or sole shareholder of a corporation.

▪Only a team leader can create a team LLC or corporation.

▪A principal broker can pay earned compensation to an LLC or corporation that is solely owned by a salesperson or associate broker who is affiliated with a principal broker after the licensee sends written instructions to the principal broker.

▪A team LLC or corporation can be used to collect funds from team members to pay common expenses such as team marketing or an unlicensed administrative assistant.

▪The principal broker is required to make sure that each LLC or corporation is solely owned by no more than one affiliated licensee.

▪After an LLC or corporation is created, an annual report must be filed or the  Rhode Island Secretary of State can revoke the LLC or corporation.  File Your Annual Business Report - Rhode Island - Gregg M. Amore

DON’TS

▪The LLC or corporation cannot be licensed or conduct real estate business in its own name.

▪A team LLC or corporation cannot pay team members.  The principal broker must pay all affiliated licensees, including team members, directly or to their individual LLC or corporation.