FinCEN’s New Real Estate Reporting Rule: What 1031 Investors Should Know

Update as of March 19, 2026: FinCEN’s real estate reporting requirements are currently suspended, and First American has paused collection of this information. Real estate transactions and closing timelines are continuing without disruption, including transactions already in progress. Because this situation may change on short notice, we are monitoring developments closely and will provide updates as additional guidance becomes available. If you have questions about how these changes may affect your transaction, your First American team is here to help.

The Financial Crimes Enforcement Network (FinCEN) has finalized its Anti-Money Laundering (AML) Real Estate Transfers Reporting Rule (RRE Rule). Beginning March 1, 2026, certain all-cash residential real estate transactions will require new FinCen reporting requirements to help strengthen AML compliance in real estate. 

For most 1031 Exchangors, the impact will be minimal. Any exchanging investors acquiring residential real estate as replacement property, all cash, will be required to provide certain information to the settlement agent (more below). Note that for reverse exchanges involving cash purchases of residential property, the Qualified Intermediary (QI) is considered the settlement agent for reporting purposes. 

Who Collects the Information?  

The settlement agent (typically the escrow or closing officer) is considered the “reporting person” and is responsible for collecting the information requested by FinCEN. 

What’s Covered Under the FinCEN Real Estate Reporting Rule?  

The FinCEN real estate reporting rule applies nationwide and to all-cash or non-traditionally financed residential purchases by entities or trusts. 

What Information Is Reported?  

These FinCEN reporting requirements mean that the settlement agent must collect and submit details on the buying entity or trust’s beneficial owner disclosure — i.e. the individual(s) who ultimately own or control the entity — to FinCEN through its new Real Estate Reporting (RER) system. Certain seller information must also be included, whether the seller is an individual, entity, or trust. 

A Note on Reverse Exchanges 

If you purchase a residential property all-cash through a reverse exchange and unwind by assuming the EAT’s membership interest, First American Exchange Company will be required to report the transfer as the reporting person. 

Why the Rule Matters 

FinCEN’s rule aims to support anti-money laundering in real estate and enhance transparency across the U.S. market. For Exchangors, it’s important to understand how a Qualified Intermediary ensures compliance with IRS regulations while also adhering to the new FinCEN reporting requirements for real estate. Early communication with your QI and settlement agent will help ensure AML compliance in your real estate transaction and avoid delays once the rule takes effect.