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On March 19, 2026, the U.S. District Court for the Eastern District of Texas issued a ruling vacating FinCEN’s 2024 Final Rule governing mandatory reporting for non-financed residential real estate transactions involving buyers who are legal entities, such as limited liability companies, partnerships, and some trusts.

The rule took effect on March 1, 2026, creating significant new reporting responsibilities for industry participants.  In anticipation of those new reporting responsibilities, the MNR Forms Committee recently approved and published a notice to provide to both buyer and seller clients regarding these new requirements and what may be expected of all parties to a transaction falling under these guidelines.    

However, in its March 19th ruling, the U.S. District Court held that FinCEN exceeded its statutory authority under the Bank Secrecy Act, determining that the agency cannot classify an entire category of ordinary transactions as “suspicious” without adequate justification.  The court found that the law authorizes reporting of only specific suspicious transactions, not sweeping categories. As a result, the court vacated the rule nationwide. FinCEN has acknowledged the ruling and issued a statement that the rule which took effect on March 1st will not currently be enforced or required.