On March 20, 2026, the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) has issued updated guidance following a recent decision from a U.S District Court for the Eastern District of Texas.
The case, Flowers Title Companies, LLC v. Bessent ruled to vacate FinCEN’s Residential Real Estate Reporting Rule.
The reporting requirement formally applied to non-financed residential real estate transfers (including cash transactions) where the buyer is a legal entity or trust, rather than an individual. Covered residential property generally includes one-to-four family homes, condominiums, cooperative units, and certain vacant land intended for residential development.
A federal court in the Eastern District of Texas ruled that the Financial Crimes Enforcement Network (FinCEN) exceeded its legal authority when it issued its 2024 rule requiring nationwide reporting of certain non-financed residential real estate transactions (primarily cash purchases by entities or trusts).
The court found that the Bank Secrecy Act only allows reporting requirements for “suspicious” transactions, and FinCEN failed to justify treating all covered real estate transactions as suspicious. The agency’s reasoning and data were considered too broad and unconvincing. The court also rejected FinCEN’s alternative argument that another provision of the law allowed such reporting, finding it only permits procedural requirements—not new, sweeping reporting mandates.
What Does This Mean?
Per guidance issued late Friday, March 20, reporting persons are not currently required to file Real Estate Reports and are not subject to liability for failing to do so while the court order remains in effect. At this time, compliance to this rule is currently suspended.
According to the FinCEN website:
“In light of a federal decision, reporting persons are not currently required to file real estate reports with FinCEN and are not subject to liability if they fail to do so while the order remains in force”.
However, FinCEN has not yet addressed how this decision could impact other reporting requirements. It is likely FinCEN could appeal this decision.
Please contact our office if you have any questions regarding how may impact your clients moving forward. This is an ongoing matter, and we will continue to provide updates as they become available to us.