Q. Can my license be disciplined for a failure to pay my state income taxes in Massachusetts?

A. Technically the answer would be no. As you know, licensed real estate
agents are required to state, under the pains and penalties of perjury, that
they have paid all owed state income taxes when they become licensed
on their initial license application and on subsequent license renewal
applications. That statement is not driven by the licensing law or
Board regulations, but by a statutory requirement in the Commonwealth’s
General Laws.

In a nutshell, the licensing boards within the Massachusetts Division of
Professional Licensure (DPL)—the Board’s parent agency—are required
by Massachusetts law to assist in ensuring compliance with relevant
Massachusetts tax laws. The actual enforcement of the Commonwealth’s
tax laws in these situations is performed by the Massachusetts
Department of Revenue (DOR). When DOR finds taxpayers in arrears
of their tax obligations, it will notify them of such arrearage and seek
to obtain a payment plan for the taxpayer. Naturally, taxpayers can
contest the DOR determination in a hearing. If a taxpayer fails to contest such determination, loses in a hearing, or cannot agree to a payment
plan, then DOR may notify DPL of the delinquent taxpayer.

Notice by DOR to DPL of a licensee’s tax delinquency only occurs
after the licensee-taxpayer is provided with all required due process under
the law by DOR. Where DPL receives a notice of tax delinquency it is
required to prevent the licensee from receiving their next scheduled license
renewal application and it notifies the licensee of this action. However,
no disciplinary action is taken, such as a license suspension or revocation,
and the license continues to be current (unless it has already expired).
Given that the next license renewal application will be effectively stopped,
the license will simply expire when its term is complete, unless the licensee
notifies the Board that the matter with DOR is resolved and the Board
verifi es this. If the Board verifi es that the tax delinquency matter is resolved
with DOR, the licensee will then be permitted to renew their license.

The point is that while the Board takes no disciplinary action, the licensee will not be permitted to renew such license. Therefore, once the term is complete, the license will expire and the licensee cannot practice real estate
brokering in Massachusetts.

INACTIVE VS. EXPIRED

Q. Is an inactive and expired license really the same thing?

A. No. Though in neither case, with one exception for inactive licensees,
can you practice as a real estate agent. Inactive licensees who did not
complete continuing education are renewed as inactive. Inactive licensees
cannot work, with the exception being that they may earn a referral fee for
the referrals they make to licensed active real estate brokers. Those with
an expired license cannot practice real estate brokering at all.

The Board of Registration of Real Estate Brokers & Salespersons office in Boston can be reached at 617-727-2373.