The US Financial Crimes Enforcement Network (FinCEN) has published detailed guidance for its new nationwide Residential Real Estate Reporting rule, set to take effect from December 1, 2025. The rule mandates reporting by real estate professionals for non-financed transfers of residential property to legal entities or trusts, aiming to combat money laundering and increase transparency in the sector.
FinCEN’s Final Rule and Implementation
As reported by FinCEN, the new rule requires certain individuals involved in real estate closings and settlements to report information about specified transfers of residential real estate deemed at high risk for illicit finance. The reporting obligation is nationwide and covers transfers of single-family houses, townhouses, condominiums, cooperatives, and even vacant land intended for building structures for one to four families.
The rule is effective from December 1, 2025, and replaces previous geographic targeting orders (GTOs) with a uniform national standard.
Key Provisions of the Reporting Rule
The reporting person, typically the closing or settlement agent, must submit detailed information to FinCEN’s secure BSA database, which is not publicly accessible. The report includes 111 data fields covering the property, transferee and transferor, beneficial owners, source of funds, payments, and reporting persons.
According to Martinez Law, reporting persons must affirm they are not aware of any unpermitted property improvements or undisclosed material facts affecting the property’s value.
Scope and Exemptions
The new rule applies to all non-financed sales or transfers of residential real property to entities or trusts, with limited transactional exemptions. FinCEN clarified that lawyers and other professionals performing closing or settlement functions must collect and report information, but are not required to maintain a separate anti-money laundering (AML) program for this purpose. The rule does not impose geographic or purchase price thresholds, marking a significant expansion of reporting obligations.
Public Outreach and Compliance
FinCEN has launched a nationwide public service announcement (PSA) campaign to educate stakeholders, including real estate professionals and business owners, about the new reporting requirements. The campaign includes television, radio, and digital ads, as well as in-person and virtual engagements with industry groups and government agencies.
FinCEN’s E-Filing system is available for reporting, and stakeholders are encouraged to review the Beneficial Ownership Information (BOI) reporting requirements and deadlines.
Industry Impact and Preparation
Title industry professionals are advised to prepare for the new requirements by reviewing FinCEN’s draft reporting form and compliance guides. Old Republic Title noted that the rule introduces a new landscape for title companies, requiring them to collect and report significant amounts of private information for residential property transfers to legal entities and trusts.
Mayer Brown highlighted that FinCEN will request public comment on the format of the report at a later date, allowing for industry input before full implementation.
Legal and Regulatory Context
The rule stems from the bipartisan Corporate Transparency Act, enacted in 2021 to curb illicit finance by increasing transparency in corporate ownership. FinCEN’s move follows broader efforts to combat money laundering through real estate transactions, with previous rules focused on beneficial ownership reporting for companies.
The new residential real estate rule represents a major shift in regulatory oversight for the sector, aiming to address transactions that present a high risk for illicit financial activity.
Statement from FinCEN and Treasury
In a statement, FinCEN officials emphasized the importance of transparency and compliance, noting that the new rule will help law enforcement agencies detect and deter money laundering in the residential real estate sector. Treasury Secretary Scott Bessent reiterated that regulations are being reviewed to ensure they are fit-for-purpose and support economic growth, while balancing the need for robust anti-money laundering controls.
The FinCEN Residential Real Estate Reporting rule marks a significant development in US anti-money laundering policy, requiring nationwide reporting of non-financed transfers to entities and trusts. Real estate professionals, title companies, and legal practitioners must familiarize themselves with the new requirements and prepare for compliance, while stakeholders are encouraged to participate in public comment opportunities and review FinCEN’s guidance and outreach materials.