Iowa Code Chapter 543B.46
1. Each real estate broker shall maintain a common trust account
in a bank, a savings and loan association, savings bank, or
credit union for the deposit of all down payments, earnest
money deposits, or other trust funds received by the broker
or the broker's salespersons on behalf of the broker's principal,
except that a broker acting as a salesperson shall deposit
these funds in the common trust account of the broker for whom
the broker acts as salesperson. The account shall be an interest-bearing
account. The interest on the account shall be transferred quarterly
to the treasurer of state and transferred to the department
of economic development for deposit in the local housing assistance
program fund established in section 15.354 unless there is
a written agreement between the buyer and seller to the contrary.
The broker shall not benefit from interest received on funds
of others in the broker's possession.
Iowa Administrative Rules - From Chapter 13 Trust Account
13.1(2) Unless there is a written agreement between all parties
to the transaction to the contrary, or the provisions of paragraph
13.1(2)"g" apply, all
interest earned on the trust account shall be transferred on
a calendar quarter basis to the state. The amount to be remitted
to the state will be the amount of interest earned less any
service charges directly attributable to the requirement of
maintaining an interest-bearing account and of remitting the
interest to the state. The broker may have the depository remit
the interest directly or the broker may remit the interest
but, in either case, it shall be the responsibility of the
broker to see that the interest is remitted.
g. A broker shall enter into a written agreement to pay interest
to a buyer or seller in a transaction, or to a third party
if requested by the parties to the contract and agreed to by
the
broker, if the client's trust funds can earn net interest.
In determining whether a client can earn net interest on funds
placed in trust, the broker shall take into consideration all
relevant factors including the following:
(1) The amount of interest that the funds would earn during
the period in which they are reasonably expected to be deposited;
(2) The cost of establishing and administering an individual
interest-bearing trust account in which the interest would
be transmitted to the client, including any needed tax forms;
and
(3) The capability of the financial institution to calculate
and pay interest to individual clients through subaccounting
or otherwise.
13.1(3) With the agreement of all parties, a trust account
may bear interest to be disbursed to (1) the buyer or seller
involved in a real estate purchase, sale or exchange transaction,
or (2) the property owner, if the property management or rental
contract contains this specific provision, or (3) as otherwise
specifically allowed or provided in Iowa Code sections 562A.12(2)
and 562B.13(2),
or (4) a third party if requested by the parties to the contract
and agreed to by the broker.
13.1(11) A trust account may bear interest to be disbursed
to the buyers or sellers or to a third party if requested by
the parties to the contract and agreed to by the broker with
the written approval of all parties to the contract or to the
owner if the trust account is for a property management account
and the management contract so specifies, or as otherwise specifically
allowed or provided in Iowa Code sections
562A.12(2) and 562B.13(2). The account shall be a separate
account from the account(s) which is to accrue interest to
the state. The broker shall not benefit from interest received
on funds of others in the broker's possession. Interest shall
be disbursed to the owner or owners of the funds at the time
of settlement of the transaction or as agreed to in the management
contract and shall be properly accounted for on closing statements.
Service charges for the account are a business expense of the
broker and shall not be deducted from the proceeds.
Back to top | 
