Key Takeaways
- Ohio brokers must maintain trust accounts in Ohio financial institutions
- Earnest money and client funds must be deposited within 2 business days
- Trust accounts must be reconciled monthly with records retained for 3 years
- Commingling personal and trust funds is prohibited except for minimal bank fees
- Conversion of trust funds is a criminal offense and grounds for license revocation
Last updated: January 2026
Trust Account Management in Ohio
Proper handling of client funds is one of the most important responsibilities of an Ohio real estate broker.
Trust Account Requirements
Account Setup
| Requirement | Specification |
|---|---|
| Account Type | Trust or escrow account |
| Location | Ohio financial institution |
| Account Name | Must be designated as trust/escrow |
| Interest-bearing | Permitted with proper disclosure |
| FDIC Insured | Required |
Types of Funds Held in Trust
| Fund Type | Description |
|---|---|
| Earnest Money | Deposits on purchase contracts |
| Security Deposits | Rental property deposits |
| Rent Collections | When broker manages property |
| Option Fees | For lease-option arrangements |
| Down Payments | Advance payments on contracts |
Deposit Requirements
Timeline: 2 Business Days
Ohio requires trust funds to be deposited within 2 business days of receipt.
| Day | Action |
|---|---|
| Day 0 | Receive earnest money |
| Day 1 | First business day |
| Day 2 | Must be deposited |
Business Days
Business days exclude:
- Saturdays
- Sundays
- State and federal holidays
What Constitutes Receipt
A broker "receives" funds when:
- Check is physically received
- Wire transfer is confirmed
- Cash is received (document immediately)
Prohibited Practices
Commingling
Commingling is mixing trust funds with personal or business funds. It is strictly prohibited.
| Permitted | Prohibited |
|---|---|
| Keeping funds to cover bank fees | Mixing personal funds in trust |
| Separate trust account | Using one account for all |
Conversion
Conversion is using trust funds for personal purposes:
- Serious violation
- Criminal offense
- Grounds for immediate revocation
- May result in prosecution
Premature Disbursement
Brokers cannot disburse trust funds until:
- Transaction is consummated (closed)
- Transaction is terminated with agreement
- Court order directs disbursement
Trust Account Maintenance
Reconciliation Requirements
| Requirement | Frequency |
|---|---|
| Bank reconciliation | Monthly |
| Trial balance | Monthly |
| Discrepancy resolution | Immediately |
| Broker review | Each reconciliation |
Record Retention
| Record Type | Retention Period |
|---|---|
| Trust account records | 3 years |
| Bank statements | 3 years |
| Deposit records | 3 years |
| Disbursement records | 3 years |
Earnest Money Disputes
When Parties Disagree
When buyer and seller dispute earnest money:
- Hold the funds - Do not disburse
- Document the dispute - Written record
- Attempt resolution - Mediation encouraged
- Interpleader - File with court if no resolution
- Court decides - Judge determines rightful owner
Interpleader Action
| Step | Action |
|---|---|
| File with court | Deposit funds with court |
| Name both parties | Buyer and seller |
| Broker withdraws | No longer holds funds |
| Court decides | After hearing |
Important: The broker is a neutral stakeholder. Never take sides in earnest money disputes.
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Test Your Knowledge
Within how many business days must an Ohio broker deposit earnest money?
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Test Your Knowledge
How often must Ohio brokers reconcile their trust accounts?
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