The Moehrl v. National Association of Realtors settlement did two things: NAR agreed to pay $418 million to a defined group of past home sellers, and it agreed to change the rules that governed how real estate commissions were advertised and paid. A federal court gave final approval in November 2024, and the rule changes took effect on August 17, 2024. The claim deadline for the payment fund was May 9, 2025, and it has passed. The rule changes, however, still shape every home sale and purchase in the country.
What the Lawsuit Challenged
Home sellers sued NAR and several large brokerages, including Keller Williams, RE/MAX, and Berkshire Hathaway subsidiary HomeServices of America, under the Sherman Antitrust Act.1Office of the Law Revision Counsel. 15 U.S. Code 1 – Trusts, Etc., in Restraint of Trade Illegal; Penalty Their theory targeted a NAR rule sometimes called the Cooperative Compensation Rule or Participation Rule. Under it, a listing broker had to offer compensation to the buyer’s broker as a condition of putting a property on the Multiple Listing Service, the shared database agents use to market homes.2Department of Justice. National Association of Realtors v. United States of America, Et Al.
The plaintiffs argued that baking a compensation offer into every listing pushed commissions toward a standard range, roughly 5% to 6% of the sale price, with little room to negotiate. Sellers effectively paid the buyer’s agent, and buyers had no reason to push back on a fee somebody else was covering.
The $418 Million Payout and Who Qualified
NAR agreed to pay $418 million to resolve Moehrl and a set of related claims. Some corporate defendants had already settled separately; HomeServices of America, for example, paid $250 million. The class of sellers eligible to share in the fund was narrower than the industry itself. To qualify, a seller had to meet all of the following:3Real Estate Commission Litigation. Long Form Notice
- Sold the home between March 6, 2015, and December 31, 2020.
- Used an agent or broker affiliated with one of the corporate defendants.
- Paid a commission to their agent or broker in connection with the sale.
- Listed the property on one of about 20 designated MLS systems in specific states, including Florida, Texas, Colorado, Ohio, Minnesota, Pennsylvania, Virginia, and North Carolina.
Sales below $56,500, auction sales, and transactions involving employees or officers of the defendants were excluded.3Real Estate Commission Litigation. Long Form Notice Sellers in states without a covered MLS were not part of the class. The deadline to file a claim was May 9, 2025, and it has passed; no new claims are being accepted.4Real Estate Commission Litigation. Key Dates – National Association of Realtors
The Rule Changes That Took Effect August 17, 2024
These are the parts of the settlement that reach every home sale, not just past ones. Three changes matter.
No Commission Offers on the MLS
The MLS can no longer carry any offer of compensation from a listing broker to a buyer’s broker. NAR’s revised policy says the MLS “must not accept listings containing an offer of compensation” to other participants, and the association cannot create a workaround platform to serve the same function.5National Association of REALTORS®. Summary of 2024 MLS Changes Sellers can still offer to pay a buyer’s agent, but that offer has to travel through other channels: a brokerage’s own website, or direct conversations between agents.6National Association of REALTORS®. Communicating Offers of Compensation What changed is the automatic broadcast to every agent in the market.
Written Buyer Agreements Before Touring
An agent working with a buyer must sign a written agreement with that buyer before touring a home.7National Association of REALTORS®. National Association of REALTORS® Reminds Members and Consumers of Real Estate Practice Change The agreement has to state the agent’s compensation as a specific amount or rate, not an open-ended figure. It must also state that broker fees are fully negotiable and not set by law, and it must bar the agent from collecting more than the agreed amount from any source.5National Association of REALTORS®. Summary of 2024 MLS Changes If you are buying a home, expect that conversation before your first showing.
Mandatory Negotiability Language
Listing agreements, buyer agreements, and pre-closing disclosure documents must include conspicuous language stating that broker compensation is not set by law and is fully negotiable.5National Association of REALTORS®. Summary of 2024 MLS Changes Listing agents also have to disclose to sellers, in writing, any payments the seller will make to anyone acting for the buyer, including the amount or rate.
What Commissions Look Like Now
The early numbers are more muted than many predicted. Buyer’s agent commissions dipped right after the settlement was announced, dropping to an average of about 2.36% in the third quarter of 2024. They then climbed back, reaching roughly 2.43% by mid-2025, close to where they sat before the changes. The structural shift is real; the sharp drop in rates that some expected has not arrived.
The transparency change is still meaningful for anyone in a transaction now. Buyers see what their agent will cost before they commit. Sellers are no longer locked into advertising a commission for the other side through the MLS. Whether that translates into lower rates over time depends on how the market adjusts to the new framework.
If You Received a Settlement Payment
The IRS treats settlement payments based on what they replace. Under IRC Section 61, income is taxable unless a specific exclusion applies, and the main exclusion under IRC Section 104 covers physical injuries, which does not fit this case.8Internal Revenue Service. Tax Implications of Settlements and Judgments A payment reimbursing you for overpaid commissions could be treated as a return of capital that reduces your basis in the property you sold, or as ordinary taxable income. The classification depends on the facts and on how the settlement documents describe the payment. IRS Publication 4345 covers class-action settlement payments specifically. Talk to a tax professional before you report it.