New Federal Reporting Rule for Certain Residential Real Estate Transactions
Mark Heckele
Feb 04 2026 16:50
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What Buyers, Investors, and Trusts Need to Know Before March 1, 2026

 

Beginning March 1, 2026, a new federal rule from the Financial Crimes Enforcement Network (FinCEN) will require additional reporting for certain residential real estate transactions. The rule is officially titled the Residential Real Estate (RRE) Anti-Money Laundering Reporting Rule, and while it is aimed at combating illicit finance, it will have very real, practical impacts on buyers, investors, trusts, and professionals involved in real estate closings.

Here’s what you need to know—and how to prepare.

Why FinCEN Issued This Rule

 

FinCEN is part of the U.S. Treasury Department and is responsible for enforcing anti-money laundering laws. Historically, many residential real estate purchases—especially all-cash purchases made through entities or trusts—did not require disclosure of who actually owned or controlled the buyer.

 

FinCEN’s new rule is designed to increase transparency around beneficial ownership in higher-risk transactions, particularly where traditional mortgage lenders (and their compliance systems) are not involved.

Which Transactions Are Covered?

 

A FinCEN report may be required if all of the following apply:

 

1. The Property Is Residential

The rule applies to most 1–4 family residential properties, including:

  • single-family homes

  • condominiums and townhomes

  • co-ops

  • certain land intended for residential construction

2. The Buyer Is Not an Individual

The buyer (called the “transferee”) is a:

  • corporation, LLC, partnership, or other legal entity, or

  • trust

(Some buyers—such as banks and certain government entities—are exempt.)

3. The Transaction Is “Non-Financed”

The transaction does not involve a traditional mortgage from a financial institution that is subject to federal anti-money laundering and suspicious activity reporting rules.

In practice, this often means:

  • all-cash purchases, or

  • private or seller financing

4. The Transaction Closes On or After March 1, 2026

The rule applies based on the closing date, not the contract date.

What Information Is Reported?

 

For covered transactions, a Real Estate Report must be filed with FinCEN. While the filing is not public, it requires disclosure of information such as:

  • the property being transferred,

  • the buyer entity or trust,

  • individuals representing the buyer in the transaction, and

  • the beneficial owners of the buyer (generally the individuals who ultimately own or control it).

This typically includes names, dates of birth, addresses, and taxpayer identification numbers for beneficial owners.

Who Is Responsible for Filing the Report?

 

Importantly, buyers do not file the report themselves.

Instead, FinCEN assigns the obligation to a single “reporting person” involved in the transaction. This may be:

  • the closing or settlement agent,

  • the party preparing the settlement statement,

  • the person recording the deed, or

  • the party disbursing the largest amount of funds (often through a trust account).

In many transactions, this responsibility may fall on legal counsel or a title/settlement professional, unless the parties agree in writing to designate someone else to handle the filing.

Does This Create New Compliance Obligations for Buyers?

 

The rule does not prohibit transactions and does not require buyers to register with FinCEN. However, buyers using entities or trusts should expect:

  • additional questions during the closing process, and

  • a need to provide accurate beneficial ownership information in a timely manner.

Failure to provide required information can delay closing or create compliance issues for the professionals involved.

What Should Buyers and Investors Do Now?

 

With the effective date still ahead, now is the right time to:

  • review how you structure real estate purchases (especially entity and trust ownership),

  • understand when a transaction may be considered non-financed, and

  • work with legal counsel early to avoid surprises at closing.

How We Can Help

 

Our firm regularly advises clients on:

  • entity and trust structuring for real estate ownership,

  • residential and investment real estate transactions, and

  • navigating new regulatory and reporting requirements.

If you are planning to purchase residential property through an entity or trust—particularly using cash or private financing—we recommend discussing the transaction before closing to ensure a smooth process under the new rules.

If you have questions about how the RRE Rule may apply to your situation, feel free to contact us.

 

This article is for general informational purposes only and does not constitute legal advice.