The Residential Real Estate Rule (“RRE Rule”), promulgated by FINCEN, is effective as of March 1. This rule, the aim of which is to combat money laundering and the concealment of beneficial ownership through legal structures, requires a filing when residential real estate is transferred to certain entities or trusts. This rule will impose beneficial ownership reporting requirements (similar to those previously contemplated under the Corporate Transparency Act). The beneficial ownership disclosure requirements apply when all four of the following conditions are met:
- The real estate being transferred is “residential real estate;”
- The transfer is not financed by a financial institution;
- The transferee qualifies as a “transferee entity” or “transferee trust;” (described below) and
- No exception (listed below) applies.
The RRE Rule requires that the following disclosures be submitted by the reporting person in a Reportable Transfer:
- The property being transferred;
- Each legal entity or trust receiving the property;
- Each beneficial owner of the legal entity or trust (including taxpayer identification information);
- Each signing individual;
- Each individual, entity, or trust transferring the property (including taxpayer identification information); and
- Any payments made for the property.
Please see the link below to learn more about the requirements.
