I tried to parse a little of this so, FinCEN wants to know who profits off of real estate if you are a 5% equity share holder or 10% if at a director level in an organization.
Will FinCEN publish these records? It would defeat the purpose of putting a home in an llc for anonymity.
Under the proposed rule, persons involved in real estate closings and settlements would continue to be exempt from the anti-money laundering compliance program requirements of the Bank Secrecy Act. I.e. loans, banks.
That's too bad; methinks the Feds should also need a court order. Though, I suppose with FISA courts rubber-stamping warrants, it wouldn't even be a nuisance.
Depends on your level of cynicism whether they'll follow the guardrails, but they do have some;
> Federal government agency access to BOI. Under the Access Rule and as authorized by the CTA, FinCEN may disclose BOI to Federal agencies engaged in national security, intelligence, or law enforcement activity if the requested BOI is for use in furtherance of such activity. “Law enforcement activity” includes both criminal and civil investigations and actions, such as actions to impose civil penalties, civil forfeiture actions, and civil enforcement through administrative proceedings. Prior to requesting BOI, Federal agency users will be required to certify that the agency is engaged in a national security, intelligence, or law enforcement activity and that the information requested is for use in furtherance of that activity. They will also be required to provide the specific reasons why the requested information is relevant to the activity.
> It would defeat the purpose of putting a home in an llc for anonymity.
That's a legitimate desire, and I think we should make privacy and the motives behind it available to everyone, not only those who can afford the expense and effort to set up and maintain an LLC.
(I'd expect the solution to be a combination of changes: outlaw most data-brokering and trading of personal data, hold organizations responsible for the data they hold so much that they treat unnecessary personal data like an existential-threat toxic liability, change practices to make SWAT-ing not be such a risk even if some psycho did get hold of someone's address, hold demagogues responsible for using conspiracy theories they know are false to incite mentally ill people, and more.)
>> It would defeat the purpose of putting a home in an llc for anonymity.
> That's a legitimate desire, and I think we should make privacy and the motives behind it available to everyone, not only those who can afford the expense and effort to set up and maintain an LLC.
I'm on the fence about that. Why should someone not be able to determine who owns a particular piece of property?
If they have nothing to hide they have nothing to fear. I would take the hypothetical fear and pushback by these "types" as a strong positive signal that this is an effort that is vitally worth doing for society.
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.
Anyway, just to paint maybe some more realistic threat models: Swatting. People suing rich people to get "go-away" money. Targeted robberies or abductions.
Privacy is a right, also for rich people. For any information that is private, I can find a good reason for it to not be private.
They have to fear swatting. If you’ve got the time and knowledge of where the individual likely lives, a hunting app for instance will show who owns each land plot in clear-text lol.
If you’ve got the time and effort, it doesn’t have to be. These “extreme privacy” measures are available to the laymen with some time/effort/money, or definitely for someone with a tech job.
One of the main steps is buying or renting under a LLC. Anyone can do that with planning.
Liberty is freedom with responsibilty, not free from responsibility. There's definitely a middle ground between "You can only license one house from Great Society, comrade" and letting America become a rent-extraction exercise rather than real value creation. Forgive me for looking dimly on the situation.
> If they have nothing to hide they have nothing to fear.
Ok then. Share with us your email and social media passwords -- and give us access to your Google Photos while you're at it. Otherwise -- what are you hiding?
Is nothing in our life private now? What about the need for privacy. Random ppl shouldn't know your financial holdings. We have a real lack of privacy now and easy access to the public records.
There is public benefit to knowing the beneficial owner of real estate. It is the physical assets of a community and the community benefits from knowing who ultimately owns those assets.
If you tax land properly, it doesn't matter who's the owner of the estate as long as the state can reach them or start a process to claw back the estate for nonpayment of taxes.
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 bucket mentality is deeply destructive and dangerous.
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?
Something like this argument applies to a lot of privately-created wealth, but not to land. Private ownership of land (and the profits generated by it) is completely philosophically incoherent if you spend a little time thinking about it, starting with the fact that private property rights require that stolen assets be returned and not able to be profited from, but all land is stolen when you trace back far enough, and all land ownership claims are the fruit of the poisoned tree.
The best approach would be one where the government issues long-term leases to parcels of land, but property taxes are an okay-ish alternative if that (or LVTs) aren't feasible. Note that this is already what we do for things like the EM spectrum: the government owns it in the public trust, then leases it with an open bidding process.
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 nothing wrong with any of this, it’s all standard procedure but my assumption is that it’s all rooted from an underlying issue, the US balance sheet keeps going up and the government is looking to cross all Ts and dot all I’s on where they can collect. The underlying issue never gets fixed, that’s that the government can’t stop spending. Fix government, fixes the issue.
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.
You are either sorely misinformed or highly inept on the subject.
[edit] to provide clarity. Holding assets in trusts or LLCs has nothing to do with doing anything illegal, and you will find politicians, people working in 3 letter agencies etc all do the same, we all pay taxes just like you. So attempting to leaving a comment with a critical view particularly in contexts where it might be seen as unfair, unjust, or disproportionately benefiting the already wealthy at the expense of others just shows a lack of understanding of the subject. Even though my initial comment has nothing to do with taxes I will leave you with this.
"Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one's taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands."
This quote captures the essence of tax planning and the legal right of individuals and businesses to minimize their tax liabilities within the bounds of the law. - Judge Learned Hand
sigh. It has nothing to do with hiding and everything to do with protecting ones assets. My guess is you either have no children or little in assets; if you happen to have either and mean what you've written above I would suggest educating yourself on the matter before writing comments like you have. Good luck.
How do these trusts, LLCs, etc. work for inheritance? Can I bypass inheritance issues by, say, putting my house in a trust and making my kid one of the "owners" of the trust? Then when I pass away, s/he gets control of the trust and thus own the house?
There is nuance, but yes. It doesn't avoid taxes except in certain edge cases; it is a more efficient form of probate. The target of the assets is the "beneficiary."
If you die with assets... you assets are going to be transferred to beneficiaries in accordance with a will if you have one. It's a lengthy legal process called probate. Because its going through the court system the filings are all public record too.
If you put your assets into a trust (generally a revocable or living trust)... when you die you aren't dying with any assets. The trust "lives on" and has the rules for distribution codified into it. No probate court. No public record of assets, etc. Tends to be a faster, more efficient for everyone process as I understand it.
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.
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?
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?
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 of magnitude smaller than the number of people who rent a home owned by a mysterious and unaccountable corporate landlord.
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.
If a person knows where another person lives, the first person can send a heavily armed SWAT detachment to the second person’s home. This is one reason my home is held in trust, so it’s a little more difficult for some idiot to try this.
I imagine if this route was banned, it would be a lot easier to figure out where a person lives, which would generally result in decreased privacy, safety, and security.
Will FinCEN publish these records? It would defeat the purpose of putting a home in an llc for anonymity.
Under the proposed rule, persons involved in real estate closings and settlements would continue to be exempt from the anti-money laundering compliance program requirements of the Bank Secrecy Act. I.e. loans, banks.