The U.S. Treasury Department is reportedly close to proposing a rule that will require that real estate professionals such as title insurers report the identities of cash-purchasing real estate owners to the Treasury’s Financial Crimes Enforcement Network (FinCEN). The proposed rule, which was first discussed by Treasury officials in 2021, would effectively end anonymous luxury-home purchases.
If adopted, the proposal would expand the program currently in place wherein title companies in certain metropolitan areas are required to report certain real estate transactions wherein the buyer is an entity. Implemented through a Geographic Targeting Order (GTO), the program requires title companies to collect beneficial ownership information for the parties underlying entity buyers.
If implemented, the new rule would effectively expand GTOs from a major metropolitan to a national level. This would be in addition to the new Beneficial Ownership Information Reporting that begins in January 2024 as a result of the Corporate Transparency Act.