Residential Real Estate Reporting - FinCEN

Starting on March 1, 2026, real estate closing companies will be required to report certain real estate transfers to the United States Treasury Department’s Financial Crimes Enforcement Network (FinCEN).
“The Department of the Treasury has long recognized that the illicit use of residential real estate threatens U.S. economic and national security and can disadvantage those that seek to compete fairly in the U.S. real estate market. This reporting requirement is designed to increase transparency in the U.S. residential real estate sector and to combat and deter money laundering.” (www.fincen.gov/rre)

This new reporting requires that certain residential real estate transactions purchased with all cash or without institutional lender financing where at least one buyer is a legal entity, limited liability company, corporation, partnership, trust, trustee, or other non-natural person, must be reported.

So this will affect your real estate transaction if the buyer is an entity, and purchasing with cash, owner financing/private financing.  This does not apply if the buyer is a “natural person” and or is getting financing from an institutional lender.  Institutional lenders are already subject to anti-money laundering and suspicious activity reporting obligations.

What if your residential real estate transaction fits this new reporting criteria?  The closing company that is handling the closing will be responsible for providing this report to the Department of the Treasury.  Both buyer and seller will need to provide to the closing company the information and documentation necessary for the closing agent to complete the FinCEN Report. This includes full legal names, date of birth, address and IRS taxpayer identification number of the beneficial owners of the buyer’s entity. The buyer will also pay the cost to prepare and file the report.  It is expected to be around $300-$400.

If the buyer in your transaction is a natural person, this reporting will not need to be done.

n summary, the purpose of this reporting is to deter and combat the use of real estate in money laundering. If you are buying or selling after March 1, 2026, be aware that if the buyer is an “entity” there will be some additional steps that will need to be taken at closing for this reporting and may add some additional time and cost to closing. If you would like to find out more information about this reporting, reach out to your real estate agent or visit www.fincen.gov/rre.