This article originally appeared as a Gavel to Gavel guest column in the Journal Record on Mar 19, 2026.
By Phillips Murrrah attorney Lacy C. Kelly
Lacy C. Kelly
The Real Estate Report Requirement (RERR), which went into effect March 1, 2026, is a reporting rule that applies to certain residential real estate transfers, especially when buyers purchase property through entities or trusts and no traditional mortgage lender is involved. The key is knowing when RERR applies, when it doesn’t, and what is required to comply with RERR.
Background
RERR is part of the federal government’s broader anti-money laundering (AML) strategy, largely driven by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). The federal government’s goal is to reduce the use of anonymous entities and trusts to purchase U.S. residential real estate with cash or non-traditional financing. For years, regulators have viewed non-financed purchases as a higher-risk for money laundering because an AML-regulated mortgage lender is not involved to perform customer due diligence.
When RERR applies
A transfer is reportable only if all three of the following are true:
- Non-Financed Transfer: There is no mortgage from an AML-regulated financial institution securing the property.
- Residential Real Property: The property is a 1–4 family home, land intended for such a home, or cooperative housing shares.
- Transferee Entity or Trust: The buyer (transferee) is an LLC, corporation, trust, or similar entity.
RERR does not have a minimum sales price threshold. Even smaller transactions can be reportable if the conditions are met.
Exceptions to RERR
The following types of transfers are not reportable even if the transfer otherwise meets the three-part test:
- Easements: Grant, transfer, or revocation of easements
- Death Transfers: Wills, intestacy, transfer-on-death deeds, or trust provisions at death
- Divorce: Transfers incident to divorce or dissolution
- Bankruptcy: Transfers to bankruptcy estates
- Court Supervision: Transfers supervised by U.S. courts
- Estate Planning: No-consideration transfers by individuals to their own trusts
- 1031 Exchanges: Transfers to qualified intermediaries
- No Reporting Person: Transfers where no one in the reporting hierarchy is involved (e.g., Closing Agent, Settlement Statement Preparer, Deed Filer, Title Insurance Underwriter, Funds Disburser, Title Status Evaluator, Deed Preparer)
Beneficial owner identification: Who must be disclosed?
RERR requires identifying and reporting beneficial owners of the transferee:
– Entity framework: Beneficial owners include anyone with substantial control or 25%+ ownership interest.
– Trust framework: Beneficial owners fall into six specific categories, including trustees and grantors with revocation rights (among others defined by RERR).
Operational burden and timing
Each RERR report includes 110 data entry points and is estimated to take 4 hours and 20 minutes to complete—meaning this is not a simple or quick form. RERR reports must be filed the later of:
– the last day of the month following the closing month, or
– 30 calendar days after closing.
Practical takeaways
– If your company uses entities or trusts to acquire residential property, treat non-financed closings as potential RERR reporting events.
– Build a repeatable process for collecting beneficial ownership details early, and don’t wait until closing.
Lacy C. Kelly is an attorney with the law firm of Phillips Murrah who represents clients in real estate transactions, estate planning, and business law matters.
About the author:
Lacy Kelly is a transactional attorney who represents clients in real estate transactions, estate planning, and business law matters.
CONTACT: lckelly@phillipsmurrah.com | 405.606.4719
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