WASHINGTON—The Financial Crimes Enforcement Network (FinCEN) today announced the renewal of its Geographic Targeting Orders (GTOs) that require U.S. title insurance companies to identify the natural persons behind shell companies used in all-cash purchases of residential real estate. These renewed GTOs are identical to the November 2019 GTOs. The purchase amount threshold remains $300,000 for each covered metropolitan area.
The terms of this Order are effective beginning May 10, 2020 and ending on November 5, 2020. GTOs continue to provide valuable data on the purchase of residential real estate by persons possibly involved in various illicit enterprises. Reissuing the GTOs will further assist in tracking illicit funds and other criminal or illicit activity, as well as inform FinCEN’s future regulatory efforts in this sector.
Today’s GTOs cover certain counties within the following major U.S. metropolitan areas: Boston; Chicago; Dallas-Fort Worth; Honolulu; Las Vegas; Los Angeles; Miami; New York City; San Antonio; San Diego; San Francisco; and Seattle. FinCEN appreciates the continued assistance and cooperation of the title insurance companies and the American Land Title Association in protecting the real estate markets from abuse by illicit actors.
The IRS finalized regulations in December of 2016 that require all foreign owners of single member LLCs to file an annual information return with the IRS. A single member LLC is an LLC owned by one person or entity, or by a husband and wife. Until now, the ownership of the LLC itself did not have to report.
Many foreigners have created a U.S. LLC themselves online or through an inexperienced advisor and will not know about this new reporting requirement. Failure to file this annual return results in penalties for foreign investors using LLCs to hold investments or conduct business in the United States or abroad. If a foreign person fails to file Form 5472 when required, the initial penalty is US$10,000. This penalty is increased by US$10,000 for each 30-day period (after an initial 90-day period) for which the failure persists.What are the choices for a foreigner now?
For foreigners coming to the United States to visit, live, work or invest.
For foreigners with FIRPTA planning and tax savings.
For US taxpayers – planning for income tax and estate/gift tax savings.
How to safely maximize your opportunities with established strategies.
Tax Guide 4 Foreigners: Investing, Working or Living in the United States published in English, or in Bi-lingual English-Simplified Chinese in print or in English in ebook formats from Amazon.com
Also available to purchase in a Bi-lingual English-Simplified Chinese version at www.taxguide4foreigners.com. This edition is for those purchasers outside of the Amazon shipping areas. It requires that you print out the copy purchased yourself.