WHAT IS THE REAL ESTATE REPORT?

The Real Estate Report is a federal filing that real estate professionals must submit to the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury, for certain non-financed transfers of residential real property to legal entities and trusts.

Reporting persons have an ongoing duty to file updated Real Estate Reports to reflect changes to information provided in earlier reports. If needed, reporting persons must also file corrected Real Estate Reports to fix errors discovered on previously filed reports.

In August 2024, FinCEN issued the final Anti-Money Laundering Regulations for Residential Real Estate Transfers (the Residential Real Estate Rule), codified at 31 CFR § 1031.320. The rule’s goal is to improve the U.S. government’s ability to protect the financial system from criminal use, providing essential information to law enforcement to prevent corrupt officials, money launderers, and other illicit actors from hiding money through entity and trust purchases of U.S. residential property.

According to FinCEN, the ultimate goal of the rule is to close a long-standing vulnerability in the residential real estate market — non-financed purchases by legal entities and trusts that historically have not been subject to anti-money laundering scrutiny.

The Real Estate Report applies to transactions that meet four conditions: the transfer involves residential real property in the U.S., it is non-financed, the buyer is a legal entity or trust, and no specific exemption applies.