2012 Indiana Code
TITLE 25. PROFESSIONS AND OCCUPATIONS
ARTICLE 34.1. REAL ESTATE BROKERS AND SALESPERSONS
CHAPTER 4. PRINCIPAL BROKERS

IC 25-34.1-4
Chapter 4. Principal Brokers

IC 25-34.1-4-0.5
Managing broker

Effective 7-1-2014.

Sec. 0.5. Except as provided in section 6 of this chapter, to become a managing broker, an individual must:
(1) hold a broker's license for at least two (2) years; and
(2) take and pass at least twenty-four (24) hours of broker management courses approved by the commission.
As added by P.L.127-2012, SEC.19.

IC 25-34.1-4-1 Version a
Responsibility for actions of associated salespersons and broker salespersons; maintenance of two or more separate offices; notice
Note: This version of section effective until 7-1-2014. See also following version of this section, effective 7-1-2014.
Sec. 1. A principal broker is responsible under this article for the actions of any associated salesperson and broker-salesperson. Any principal broker who maintains two (2) or more separate offices for associated licensees shall notify the commission of the name and address of the broker who manages each office.
As added by Acts 1979, P.L.248, SEC.1.

IC 25-34.1-4-1 Version b
Responsibilities of managing broker
Note: This version of section effective 7-1-2014. See also preceding version of this section, effective until 7-1-2014.
Sec. 1. A managing broker is responsible under this article for the actions of any broker who is associated with the managing broker. Any managing broker who maintains two (2) or more separate offices for associated licensees shall notify the commission of the name and address of the broker who manages each office.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.127-2012, SEC.20.

IC 25-34.1-4-2 Version a
Partnership, corporate, or limited liability company broker to act only as principal broker; designation of responsible licensed individual broker
Note: This version of section effective until 7-1-2014. See also following version of this section, effective 7-1-2014.
Sec. 2. Except as provided in IC 23-1.5, a partnership broker, corporate broker, or limited liability company broker may act only as a principal broker and shall designate to the commission a licensed individual broker, who is a partner or a corporate representative satisfying IC 25-34.1-3-4.1(c)(1) or a member-managed limited liability company member or a manager-managed limited liability company representative satisfying IC 25-34.1-3-4.1(d)(2), to be

primarily responsible to the commission for its actions.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.128-1994, SEC.4; P.L.229-1995, SEC.7.

IC 25-34.1-4-2 Version b
Partnership, corporate or limited liability company broker to act as managing broker
Note: This version of section effective 7-1-2014. See also preceding version of this section, effective until 7-1-2014.
Sec. 2. Except as provided in IC 23-1.5, a partnership broker, corporate broker, or limited liability company broker may act only as a managing broker and shall designate to the commission a licensed individual broker, who is a partner or a corporate representative satisfying IC 25-34.1-3-4.1(c)(1) or a member-managed limited liability company member or a manager-managed limited liability company representative satisfying IC 25-34.1-3-4.1(d)(2), to be primarily responsible to the commission for its actions.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.128-1994, SEC.4; P.L.229-1995, SEC.7; P.L.127-2012, SEC.21.

IC 25-34.1-4-3 Version a
Residency requirement for principal brokers; certain nonresidents may be principal brokers
Note: This version of section effective until 7-1-2014. See also following version of this section, effective 7-1-2014.
Sec. 3. (a) Except as provided in subsection (b), each individual who is a principal broker or is designated by a partnership, corporation, or a limited liability company pursuant to section 2 of this chapter shall be a resident of Indiana.
(b) A nonresident:
(1) individual broker; or
(2) individual designated by a partnership, corporation, or limited liability company under section 2 of this chapter;
may be a principal broker if all the licensees affiliated with the broker, partnership, corporation, or limited liability company are not residents of Indiana.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.128-1994, SEC.5; P.L.64-2004, SEC.21.

IC 25-34.1-4-3 Version b
Residency requirements of managing brokers; certain nonresidents may be managing brokers
Note: This version of section effective 7-1-2014. See also preceding version of this section, effective until 7-1-2014.
Sec. 3. (a) Except as provided in subsection (b), each individual who is a managing broker or is designated by a partnership, corporation, or a limited liability company pursuant to section 2 of this chapter shall be a resident of Indiana.
(b) A nonresident:
(1) individual broker; or (2) individual designated by a partnership, corporation, or limited liability company under section 2 of this chapter;
may be a managing broker if all the licensees affiliated with the broker, partnership, corporation, or limited liability company are not residents of Indiana.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.128-1994, SEC.5; P.L.64-2004, SEC.21; P.L.127-2012, SEC.22.

IC 25-34.1-4-4 Version a
Independent contractor relationship
Note: This version of section effective until 7-1-2014. See also following version of this section, effective 7-1-2014.
Sec. 4. Notwithstanding IC 23-1.5, the association of a salesperson or broker with a principal broker, as provided by this article, creates an independent contractor relationship unless otherwise specified by a written contract entered into by the principal broker and the associated salesperson or broker.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.229-1995, SEC.8.

IC 25-34.1-4-4 Version b
Independent contractor relationship
Note: This version of section effective 7-1-2014. See also preceding version of this section, effective until 7-1-2014.
Sec. 4. Notwithstanding IC 23-1.5, the association of a broker with a managing broker, as provided by this article, creates an independent contractor relationship unless otherwise specified by a written contract entered into by the managing broker and the broker.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.229-1995, SEC.8; P.L.127-2012, SEC.23.

IC 25-34.1-4-5 Version a
Trust accounts
Note: This version of section effective until 7-1-2014. See also following version of this section, effective 7-1-2014.
Sec. 5. (a) Each principal broker:
(1) shall keep in one (1) or more trust accounts (interest or noninterest bearing) all funds belonging to others that come into the possession of the principal broker or of any associated salesperson or broker-salesperson; and
(2) shall clearly identify any account containing those funds as a trust account. The trust accounts shall contain all earnest money deposits, funds held for closing escrows, sale proceeds not yet disbursed, and all other funds belonging to others.
(b) The principal broker shall not use any trust account for the deposit of any personal funds or other business funds and shall keep a detailed record of the funds and any interest accrued in each trust account that identifies the amount of funds held for each beneficiary. Any interest earned shall be held for the beneficiary.
(c) Upon the death or termination of a principal broker or the

expiration, revocation, or suspension of the principal broker's license, the commission shall take custody of each trust account and may appoint a successor trustee to protect and distribute the proceeds of that account.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.255-1987, SEC.5; P.L.114-2010, SEC.22.

IC 25-34.1-4-5 Version b
Trust accounts
Note: This version of section effective 7-1-2014. See also preceding version of this section, effective until 7-1-2014.
Sec. 5. (a) Each managing broker:
(1) shall keep in one (1) or more trust accounts (interest or noninterest bearing) all funds belonging to others that come into the possession of the managing broker or of any broker whose license the managing broker is holding; and
(2) shall clearly identify any account containing those funds as a trust account. The trust accounts shall contain all earnest money deposits, funds held for closing escrows, sale proceeds not yet disbursed, and all other funds belonging to others.
(b) The managing broker shall not use any trust account for the deposit of any personal funds or other business funds and shall keep a detailed record of the funds and any interest accrued in each trust account that identifies the amount of funds held for each beneficiary. Any interest earned shall be held for the beneficiary.
(c) Upon the death or termination of a managing broker or the expiration, revocation, or suspension of the managing broker's license, the commission shall take custody of each trust account and may appoint a successor trustee to protect and distribute the proceeds of that account.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.255-1987, SEC.5; P.L.114-2010, SEC.22; P.L.127-2012, SEC.24.

IC 25-34.1-4-6 Version a
Death of individual principal broker or termination of partnership principal broker by death of partner
Note: This version of section effective until 7-1-2014. See also following version of this section, effective 7-1-2014.
Sec. 6. (a) In the event of the death of an individual principal broker or the termination of a partnership principal broker by the death of a partner, a salesperson formerly associated with that principal broker may continue to carry out business contracted for before the death or termination of the principal broker, for a maximum period of ninety (90) days after the death or termination. During that period, the salesperson shall maintain a trust account as provided in section 5 of this chapter. However, until associating with another principal broker the salesperson may not undertake any new business.
(b) Upon associating with a new principal broker, the salesperson may conduct on behalf of the deceased or terminated principal broker

only that business which is necessary to complete obligations assumed while associated with that principal broker. All other acts performed by the salesperson shall be performed in association with the new principal broker.
(c) Each broker-salesperson formerly associated with the deceased or terminated principal broker becomes, upon the death or termination of the principal broker, a principal broker until the broker elects to act as a broker-salesperson for another principal broker.
(d) This section applies only to matters of licensing and responsibility under this article and does not affect the transfer of the deceased principal broker's property interests as provided by IC 29 and other laws of succession.
As added by Acts 1979, P.L.248, SEC.1.

IC 25-34.1-4-6 Version b
Death of individual managing broker or termination of partnership; managing broker death of partner
Note: This version of section effective 7-1-2014. See also preceding version of this section, effective until 7-1-2014.
Sec. 6. (a) In the event of the death of an individual managing broker or the termination of a partnership managing broker by the death of a partner, a broker formerly associated with the managing broker may continue to carry out business contracted for before the death or termination of the managing broker, for a maximum period of ninety (90) days after the death or termination. During that period, the broker shall maintain a trust account as provided in section 5 of this chapter. However, until associating with another managing broker, the broker may not undertake any new business.
(b) Upon associating with a new managing broker, the broker may conduct on behalf of the deceased or terminated managing broker only that business which is necessary to complete obligations assumed while associated with the managing broker. All other acts performed by the broker shall be performed in association with the new managing broker.
(c) Each broker formerly associated with the deceased or terminated managing broker becomes, upon the death or termination of the managing broker, a managing broker until the broker elects to act as a broker for another managing broker.
(d) This section applies only to matters of licensing and responsibility under this article and does not affect the transfer of the deceased managing broker's property interests as provided by IC 29 and other laws of succession.
As added by Acts 1979, P.L.248, SEC.1. Amended by P.L.127-2012, SEC.25.