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FinCEN proposes new rule for residential real estate held in trusts or LLCs

fincen.gov

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Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#51

Post by singleshot_ »

Centigonal wrote: post #49
singleshot_ wrote: post #39

Earlier quoted context omitted.

It’s also great for sending a swat team to your house, which might have a bit more sudden of an impact than the change you’re envisioning.

The proposed FinCEN rule is specific to non-financed (i.e. all-cash) transfers to companies or trusts. That in itself rules out the vast majority of private individuals. I'm sure they could also add carve-outs for primary residences or otherwise reduce the impact of this rule on private individuals. That being said, I think the number of people who live in fear of being swatted in their homes is at least two orders o…

That’s really nice to know. I’m not sure whether my situation would qualify under that rule, thought. I do appreciate you sharing that detail. Carve-out for a primary residence would be nice but in that circumstance, it still seems like someone over at the government knows where I live, which is suboptimal.

That being left aside, I am concerned about home intrusions much more than I am with economic equity for all _and_ I don’t think this measure will be a particularly effective control on the latter.

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#52

Post by cyanydeez »

dikaio wrote: post #48

We have a business in Las Vegas incorporated as an LLC and incorporated in Wyoming to hold real estate that we purchase overtime and leave to our kids and just yesterday we were notified that FinCen is requesting names, contact information, IDs (passport, drivers license) and percentage owned in the corporation. I would have thought they would have had all that information prior from our filings. In my eyes there’s n…

good.

wealth transfer is obscene.

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#53

Post by Fin_Code »

psychlops wrote: post #16
Fin_Code wrote: post #7

This is deeply needed, one of the big causes of housing inflation is using it to launder money. Higher housing costs are better because you can launder more. Its like when rich people can't have a money trail for some shady activity so they sell art to each other for a wild amount. This will require all owners to be named instead of a nameless llc. Should help curb the process.

> one of the big causes of housing inflation is using it to launder money I'd love a link backing this bold assertion.

This is actually quite easy. Lookup how to purchase a home with cash (its easy). The house is then assigned to an owning entity to become part of a portfolio. Then after a given time based on risk you can sell to generate revenue. Then disburse to other entities that lead back to the person that dropped in the cash. The wash is completed.

Where else could you drop large quantities of cash then translate that to clean money?

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#54

Post by Fin_Code »

wmf wrote: post #42
psychlops wrote: post #16

Earlier quoted context omitted.

> one of the big causes of housing inflation is using it to launder money I'd love a link backing this bold assertion.

You'll find plenty or none depending on your desired level of detail. After reading about this topic for years I still don't understand how to use real estate for money laundering.

This is actually quite easy. Lookup how to purchase a home with cash (its easy). The house is then assigned to an owning entity to become part of a portfolio. Then after a given time based on risk you can sell to generate revenue. Then disburse to other entities that lead back to the person that dropped in the cash. The wash is completed. Where else could you drop large quantities of cash then translate that to clean money?

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#55

Post by bombcar »

phkahler wrote: post #46
bombcar wrote: post #44

Earlier quoted context omitted.

In very specific cases it can be used to avoid certain countries' laws about exporting cash/value. But that's not going to be a major source of real estate transactional volume.

>> https://news.ycombinator.com/item?id=39277767 Except in parts of Canada. This just came across HN earlier this week: https://news.ycombinator.com/item?id=39277767

That's just liar-loans, not money laundering.

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#56

Post by wmf »

Fin_Code wrote: post #54
wmf wrote: post #42

Earlier quoted context omitted.

You'll find plenty or none depending on your desired level of detail. After reading about this topic for years I still don't understand how to use real estate for money laundering.

This is actually quite easy. Lookup how to purchase a home with cash (its easy). The house is then assigned to an owning entity to become part of a portfolio. Then after a given time based on risk you can sell to generate revenue. Then disburse to other entities that lead back to the person that dropped in the cash. The wash is completed. Where else could you drop large quantities of cash then translate that to clean…

It's not suspicious to sell property that you could not afford to buy in the first place? What do you report as the cost basis? Zero?

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#57

Post by MarcoZavala »

wavefunction wrote: post #22
davrosthedalek wrote: post #21

Earlier quoted context omitted.

The expression "If they have nothing to hide they have nothing to fear" is one of the most scary sentences. I am sure the Dutch didn't think recording the religion/race was a problem. Until it was. Took some work to limit the damage [1] [1] https://en.wikipedia.org/wiki/1943_bombing_of_the_Amsterdam_...

Perhaps it was both tongue-in-cheek and not. But if they're not doing anything "wrong" then what is there to fear? Nothing. What will really happen is that we find out that there are millions of LLCs owned by a few corporate investment offices that are driving up the price of housing for my fellow citizens, actual human beings who I value far more than any legal fictions.

[dead]

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#58

Post by lazide »

kiba wrote: post #27
lazide wrote: post #19

Earlier quoted context omitted.

Ultimately, this appears to be yet another step in the direction of deep control of society over wealth and the people who have it. Which, if you ever want to have anything of your own or be better than median in some way should concern you greatly. Some people will not rest until you’re poorer and more miserable than them, no matter what. Even if it means hurting themselves (and everyone else) to do it. Crabs in a b…

Land is a scarce and valuable commodity that should be divided amongst the community to maximize its benefit for everyone, typically through taxation. If you want the most valuable land, you should be operating enterprises that provide values high enough to pay for the land.

Ah, manipulative arguments here we come!

If property taxes don't vary based on who owns them, but rather by some standardized valuation, then why does it matter if it is owned by an LLC, a Corp, or some individual? The tax is the same and needs to be paid regardless. The land will need to be used effectively, or it's a cost on a balance sheet somewhere coming out of someone's pocket.

The 'utility based value' is always the same then, correct? And the incentive to use it effectively is the same too, correct?

The 'value' of these kinds of rule changes is because, eventually, the tax WILL be different based on who owns it. 'Good people' (based on the current political winds) of course being given good rates, and 'Bad people' getting punitive rates or having it outright seized.

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#59

Post by lazide »

Eisenstein wrote: post #32
lazide wrote: post #19

Earlier quoted context omitted.

Ultimately, this appears to be yet another step in the direction of deep control of society over wealth and the people who have it. Which, if you ever want to have anything of your own or be better than median in some way should concern you greatly. Some people will not rest until you’re poorer and more miserable than them, no matter what. Even if it means hurting themselves (and everyone else) to do it. Crabs in a b…

Do you believe that wealth is an innate right no matter the societal cost -- that people should be able to own such things or amounts of things that it is to the detriment of those around them?

Wouldn't any detriment be related to the land/property itself, and hence that should be addressed?

For instance, if the owner is doing something obnoxious on a parcel in town, the town can put a lien on it, or condemn it. Then the problem is fixed and that parcel is taken away.

If someone is monopolizing hotels (say) in an area, the local county or state can pass a tax on hotels that make it less desirable to do that. Or start taking on anti monopoly action in the hotel industry in the area.

If that same person owns a parcel in another state, how do those two things relate? Or say one hotel in another state?

Unless someone also wants to go after that other parcel or property, anyway, as a prize.

Re: FinCEN proposes new rule for residential real estate held in trusts or LLCs

#60

Post by dikaio »

ragnot wrote: post #50
dikaio wrote: post #48

We have a business in Las Vegas incorporated as an LLC and incorporated in Wyoming to hold real estate that we purchase overtime and leave to our kids and just yesterday we were notified that FinCen is requesting names, contact information, IDs (passport, drivers license) and percentage owned in the corporation. I would have thought they would have had all that information prior from our filings. In my eyes there’s n…

So to clarify, you have an LLC in vegas owned by a holding LLC in Wyoming? Is that only for anonymity?

No the LLC in Las Vegas has nothing to do with the corporation in Wyoming, i provided it as reference to show that one may have a business in one state but be incorporated in another to protect personal assets, it’s quit common. We could have accomplished the same by placing each property in an a Nevada LLC but Wyoming corporations are cheaper, arguably easier to manage with better protection. Both states have no State taxes.
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