Answers by Charles Deitrick

The real estate attorney, tite company or closing agent is responsible to to the filing. Here's an overview of why this is happening. As of March 1, 2026, the Financial Crimes Enforcement Network (FinCEN) implemented a new reporting requirement aimed squarely at non-financed residential transactions where the buyer is an entity such as LLCs, corporations, partnerships, or certain trusts. In plain terms, if a property is being purchased without a traditional bank loan and the buyer is not an individual, the federal government now requires a closer look at who is actually behind that entity. At its core, this rule is about peeling back the layers. For years, purchasing real estate through an LLC offered a level of privacy. That anonymity is now largely gone in these types of transactions. The new requirement mandates that information about the “beneficial owners”, i.e., the real people who own or control the entity, be reported. This includes basic identifying details and information about how the transaction is structured. It’s not about stopping deals; it’s about understanding who is doing them. For buyers, especially investors who regularly acquire property through LLCs or trusts, this introduces a new level of disclosure. You can still structure ownership the same way, and there are no new taxes tied to this rule, but you should expect to provide more information than you have in the past. The days of quietly acquiring residential property through a layered entity structure without identification are, for all practical purposes, over. For sellers, the impact is far less significant. There’s no new filing obligation placed directly on you, and your tax treatment remains unchanged. What you may notice is a bit more diligence during the closing process. You could be asked to provide additional details or simply allow time for the reporting requirements to be satisfied. In most cases, it’s a procedural adjustment rather than a hindereance substantive burden on the closing process. Where this rule truly takes hold is at the closing table. The responsibility to file the report doesn’t typically fall on the buyer or seller, but instead on the professionals facilitating the transaction, most often the title company, closing agent, or real estate attorney. They are now tasked with determining whether a transaction is reportable, collecting the necessary ownership information, and submitting it within the required timeframe. As a result, you’ll see changes in how deals are processed, documented, and closed. In my opinion the key takeaway is this: if a residential property is being purchased without institutional financing and the buyer is an entity, there is now a federal reporting requirement attached to that transaction. It doesn’t stop deals, it doesn’t add a new tax layer, and it doesn’t fundamentally alter ownership strategy, but it does eliminate anonymity, providing for clearer transparency in the process. I suspect this requirement is laying the groundwork for something broader. Over time, the data collected could very well be used to monitor, and potentially limit, the pace at which large institutional investors acquire single-family homes for rental portfolios. That trend has accelerated in recent years, often colliding with already tight housing inventory and pushing home prices further out of reach for many would-be buyers. As ownership becomes less attainable, more households are forced into the rental pool, increasing demand on an already constrained supply and putting upward pressure on rents. While this rule is framed around transparency today, it may ultimately play a role in shaping how capital flows into the residential housing market tomorrow.