Business owners and homeowners already manage a long list of responsibilities, from tax filings to ongoing maintenance. Beginning in 2026, they will face a new requirement. Certain residential real estate transfers will trigger reporting obligations under the federal Corporate Transparency Act (the “CTA”).
Although the CTA’s business entity reporting rules remain on hold due to ongoing court challenges, regulators have confirmed that new reporting rules for residential real estate transfers will take effect on March 1, 2026.
The Current Situation
The CTA first became effective in January 2024, requiring most small and mid‑sized companies to report their beneficial owners. These are typically individuals who own at least 25% of the business or who play a significant role in how it’s managed. Court action has paused those business entity reporting requirements.
However, beginning March 1, 2026, the CTA will extend to certain residential real estate transfers. Reporting will be required when all four of the following conditions are met:
- The transfer is to an entity such as a limited liability company, corporation, or trust;
- The transaction involves a residential real estate sale;
- The property is designed for occupancy by one to four families; and
- The transaction is not financed, and no mortgage lender is involved.
If your closing meets each of these conditions, the transfer will fall within the CTA’s reporting scope.
This rule does not apply only to investors with large portfolios, as it also reaches ordinary homeowners. A homeowner who sells or transfers a residence under these conditions will be subject to the CTA’s reporting requirements.
Why It Matters
The expansion of CTA reporting has several practical implications.
Compliance risk. Penalties for failing to file can reach five hundred dollars per day. Operational risk. Non financed transfers to entities may be delayed if beneficial ownership information is not prepared in advance.
Privacy concerns. Entity structures that once shielded ownership details will now require transparency when these conditions are met.
Lessons for Residential Property Owners
Property owners can reduce risk and avoid delays by preparing early.
Confirm applicability. Determine whether your transaction meets all four conditions before closing.
Prepare early. Gather beneficial ownership information such as names, dates of birth, addresses, and identification numbers.
Consult counsel. Real estate and business counsel can help determine whether the transfer qualifies and coordinate CTA reporting.
Coordinate with closing agents. Title and escrow teams should be involved early to coordinate timelines and documentation.
Final Thoughts
The CTA will extend to certain residential real estate transfers beginning March 1, 2026. If your transaction is a non-financed transfer of one to four family residential property to an entity, CTA reporting will apply. Sellers and buyers who verify the four conditions at the outset, assemble beneficial ownership information early, and coordinate with counsel and closing agents will be better positioned to keep their transactions on track.
To learn more about From Housing Investors to Homeowners: CTA Reporting Expands in 2026 please contact Beresford Booth at info@beresfordlaw.com or by phone at (425) 776-4100.