What is the purpose of receipts in a real estate transaction?

The purpose of receipts in a real estate transaction, particularly related to option B, is to document trust money received for negotiations. Trust money refers to funds that are held in trust for a specific purpose, often related to real estate transactions, such as earnest money deposits from potential buyers. These receipts serve as important legal documents that provide evidence of the amount and the purpose of the funds received, ensuring transparency and accountability during the negotiation process.

When brokers or agents receive trust money, they are required to provide a receipt to maintain proper records and demonstrate that they are handling the funds in compliance with regulatory requirements. This documentation helps protect both the agent and the client by ensuring that there is a clear and acknowledged transfer of funds, which is crucial in preventing disputes later on.

Other options do not accurately reflect the primary function of receipts in this context. For example, while issuing payment for services rendered and recording expenses are important aspects of financial transactions, they do not specifically encompass the role of trust money in real estate negotiations. Additionally, serving as a tax document for the agent is a different type of documentation that does not pertain to the immediate purpose of documenting trust money transactions.