Realtors are now on the front lines of enhanced anti-money laundering oversight in the residential real estate market. The Financial Crimes Enforcement Network (FinCEN) has implemented new reporting requirements that expand and formalize prior geographic targeting efforts, with a particular focus on transactions involving trusts.
FinCEN’s objective is to deter and detect the use of U.S. residential real estate for money laundering, sanctions evasion, tax evasion, and other illicit finance. Trusts and other legal arrangements can obscure the identity of the true beneficial owners. By requiring timely, standardized reporting of key parties, payment methods, and beneficial ownership, FinCEN enhances law enforcement visibility while promoting market integrity and consumer confidence. These new requirements go into effect beginning March 1, 2026.
Scope of Transactions Subject to the New Reporting Rule
FinCEN’s new framework requires reporting of transfers of residential real estate, typically one-to-four family properties, and certain condominiums transfers when the purchaser is not a natural person and no regulated financial institution is conducting full anti-money laundering due diligence in connection with the transaction. Covered transactions include the following: (a) All-cash transactions or those without a bank-originated residential mortgage; (b) Purchases by legal entities and legal arrangements, including trusts (e.g., revocable trusts, irrevocable trusts, land trusts, and certain business trusts); and (c) Transfers conveying any ownership interest, including fee simple acquisitions and, in some cases, assignments to or from trusts. Transactions that are most likely to require reporting are all-cash purchases by trusts (revocable, irrevocable, and land trusts); LLCs, corporations, partnerships, or other entities where a trust is a direct or indirect owner; nominee structures, including transactions where the named purchaser differs from the beneficial owner; assignments of purchase contracts into trusts before closing; and transactions using layered payment structures (e.g., multiple wires from different accounts, cashier’s checks, or cryptocurrency) and transactions involving private lenders or hard money loans not subject to traditional lending programs.
The person responsible for closing or title services, typically the title agency or settlement agent, associated with the transaction will make the report to FinCEN. Realtors should confirm in writing which party will be responsible for submission of the Real Estate Report. The information disclosed to FinCEN will include identification of the transferee/buyer trust and its key parties (e.g., trustee, grantor, beneficiary, trust protector, and any individual exercising control); identification of the transferor/seller (entity or individual, as applicable); identification of the title or closing agent submitting the report; details of the transaction, including date, price, property address/legal description, payment method (including cash, wires, checks, cryptocurrency, or other value), and any involvement of shell entities in the chain of ownership.
The Real Estate Report must be filed 30 days after the date of closing or by the last day of the month following the month of closing, whichever is later. For example, if closing occurs on February 15th, the Real Estate Report is due March 31st. Reporting parties must keep a copy of the Real Estate Report for a period of 5 years.
Best Practices Realtors Should Implement to Support Reporting
We recommend Realtors implement the following best practices to assist reporting parties:
- Ask early whether the buyer or seller is a trust or entity and who the beneficial owners are
- Add standardized trust/entity questionnaires to your client onboarding packet
- Confirm in writing which party (title company, settlement agent, attorney, or other) will prepare and file any required FinCEN report
- Work with closing/title professionals to obtain the names, dates of birth, addresses, and IDs of trust parties and any individuals with substantial control or ownership
- Gather trust documentation sufficient to identify the trustee and the persons with control or beneficial interests (e.g. Memorandum and Certification of Trust)
- Obtain details of the payment method and the source-of-funds information required by the reporting process
- Inform buyers using trusts or entities that beneficial ownership disclosure is required and confidentially reported to FinCEN
Trust-driven purchases are increasingly common—and scrutinized. By proactively identifying trust structures, coordinating with settlement professionals, and integrating FinCEN reporting steps into your workflow, Realtors can protect clients, keep closings on track, and maintain legal compliance. For transaction-specific guidance, consult your brokerage counsel or compliance officer and the closing/title company managing the filing.
