Last week, I shared an update on the new FinCEN reporting rules that took effect March 1, 2026, requiring detailed buyer identification and ownership paperwork for all‑cash residential purchases to entities and trusts before closing. Those rules were already impacting our world here locally by slowing down quick, all‑cash closings due to the amount of front‑loaded documentation needed from buyers, title, and closing professionals.

In a major development, a federal court has now vacated that rule nationwide. On March 19, 2026, the U.S. District Court for the Eastern District of Texas, in Flowers Title Companies LLC v. Bessent, struck down FinCEN’s “Anti‑Money Laundering Regulations for Residential Real Estate Transfers,” holding that the agency exceeded its authority under the Bank Secrecy Act. The rule, which required reporting of non‑financed (cash) residential real estate transfers to entities and trusts—with no minimum price threshold—had only just become enforceable as of March 1.

The court focused on a central question: are all‑cash residential real estate transactions inherently “suspicious”? FinCEN argued yes, pointing to data showing a high percentage of transactions covered by prior geographic targeting orders were associated with parties who had also generated Suspicious Activity Reports. The judge disagreed, calling FinCEN’s explanations “vague, conclusory, and unpersuasive” and noting that many buyers pay cash or use entities and trusts for entirely legitimate reasons, such as avoiding interest costs or managing liability and estate planning. Because FinCEN classified a whole category of routine transactions as reportable without adequately showing they were inherently suspicious, the court found the rule exceeded the agency’s statutory authority and vacated it under the Administrative Procedure Act.

Practically, this means the residential real estate AML rule that took effect March 1 is no longer enforceable—for now. Title companies, settlement agents, attorneys, and other real estate professionals who would have been “reporting persons” under the rule currently have no federal obligation to make these FinCEN filings in connection with non‑financed residential transfers to entities and trusts. Treasury may still choose to appeal, so this area remains fluid, but for the moment, buyers and sellers using cash and entity structures are not subject to the new reporting regime that was expected to capture roughly 800,000–850,000 transactions a year at an estimated first‑year compliance cost between $428.4 and $690.4

For our clients, the key takeaway is that the additional upfront identification paperwork we anticipated for all‑cash entity and trust purchases is on hold following this ruling. If you’re planning a cash purchase through an LLC, trust, or other structure—or are selling to a buyer using one—please reach out so we can walk through what this decision means for your specific transaction and keep you updated if Treasury or FinCEN take further action in response to the court’s decision.

What kinds of transactions (personal home, investment, trust-owned, etc.) are you most worried about under these changing rules?