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By Accord Real Estate Group
 

LLC Residential Ownership Becomes More Transparent

October 31st 2019
Tags: Blogroll (elsewhere), Real Estate News

Signed by Governor Andrew Cuomo and effective September 13th, 2019 the New York State Tax Law and New York Administrative Code now require Limited Liability Companies to disclose the names of individuals who own any membership interest in a LLC of a 1-4 family residential property. This includes all parties involved in the purchase or sale of a property such as the directors, managers, officers and shareholders.

This reporting requirement continues indefinitely until all private persons underlying any business entity within the ownership structure are identified. A business address for every party identified above must be provided.

The laws are being interpreted by County Clarks and Title Insurance Companies as applying to Condominiums and require disclosure of every individual with an interest.

The reason for these changes are that the Government Operations Committee determined that it was too difficult to hold people responsible for violations and mistreatment of tenants because it was challenging to track down specific individuals.

These changes will also allow the public to see who is buying or selling residential property in their area and make it easier for municipalities to enforce codes and rules more efficiently.

The law does not apply if the Grantor nor Grantee is a corporation, partnership or other legal entity. If a Grantee is an LLC of which corporations is a manager, then all shareholders of the corporation must be disclosed.

A potential problem is that the statute directs that the disclosure document must be filed with the tax returns, whether the return is filed with the State Tax Dept or with the County Recording Office. There is no word yet if and when recording officers will reject recordings for failure to have the required information attached to the TP 584 or NYC RPT Form.

To be continued …

If you are interested in selling your property or you know someone who is planning to sell their Brooklyn or New York property, whether a single family residential property,  an apartment building, a commercial property, mixed use, multi family, coop or condo, vacant land or a development opportunity, call us. You will be very happy that you did.

We always bring our clients the top market price for their property and provide exceptional personalized service from initial consultation to closing.

 
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Accord Real Estate Group
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