On February 16, 2024, the Financial Crimes Enforcement Network (FinCEN) proposed a new rule to mandate certain individuals involved in real estate closings and settlements to report and maintain records on non-financed transfers of residential real property to specific legal entities and trusts nationwide. This proposed rule is called the Anti-Money Laundering Regulations for Residential Real Estate Transfers. 

Reporting persons ("RP") include, but are not limited, to real estate agents, title insurance companies, settlement agents, and attorneys. There is a “cascading” approach, based on the function performed by the person in the real estate closing and settlement that determines which RP has the burden to report. Regardless, real estate professionals would also have the option to designate a reporting person from among those in the cascade by agreement.

RPs are required to report:

1. The names and addresses of reporting persons, transferee entities, transferee trusts, signing individuals, transferors, and any beneficial owners.
2. The citizenship details for all beneficial owners of transferee entities or transferee trusts.
3. The unique identifiers, such as IRS Taxpayer Identification Numbers (TINs), for individuals and entities involved in the transactions.
4. A description of the capacity in which the signing individual is authorized to act, such as legal representative or employee.
5. The details about the total consideration paid for the property, method of payment, accounts used, and the names of payors if different from the transferee entity or trust.
6. The address of the property and a legal description, such as section, lot, and block.

RPs must e-file the report with FinCEN within 30 calendar days after the transferee entity or transferee trust receives the ownership interest in the residential real property. RPs must maintain a copy of the report, any certifications regarding beneficial ownership, and any designation agreements for five years from the date of the report filing.

Note that transfers of real property to individuals, as opposed to an entity (LLC, Corp, LLP) are not covered by this proposed rule. 

If this rule is adopted the effective date will be one year from the date the final rule is issued. This time period is to allow real estate professionals to have sufficient time to review and prepare for the implementation of the reporting requirements. 

Written comments about this proposed rule are being accepted and must be submitted on or before April 16, 2024 by utilizing this link.

On October 8, 2021, Governor Hochul signed S6492 into law and now the five eastern towns (East Hampton, Riverhead, Shelter Island, Southampton and Southold) are authorized to establish community housing funds to be funded by a supplemental real estate transfer tax.

Before any additional taxes are going to be levied, each town's board will need to enact a local law to that effect. 

Do you think that taxes should be raised on real estate sales to create affordable housing?

Before you answer that question, do you agree that the East End is unaffordable for much of its labor force?

The public purpose of this bill is "to establish a dedicated fund to provide needed housing opportunities" for "moderate income and working class local residents."

So, do you think your town should enact a local law, raise transfer taxes, and increase its supply of affordable housing? 

• The Act applies to summary proceedings or any other judicial or administrative proceeding to recover possession of a commercial unit, including evictions and ejectment actions.
• The Act only applies to a commercial tenant who:
• is a resident of New York State;
• is independently owned and operated;
• is not dominant in its field; and
• employs fifty or fewer persons.

• The Act requires the Court or the landlord (depending on the status of the eviction proceeding) to provide the tenant with the Hardship Declaration in English and in the language of the lease / tenancy agreement.
• The tenant should complete the Hardship Declaration if the tenant is suffering a financial hardship and is unable to pay rent or other financial obligations or obtain alternative suitable commercial property because of:
• significant loss of revenue;
• significant increase in necessary expenses related to providing protective equipment to prevent transmission of COVID-19; or
• moving expenses and difficulty securing alternative commercial property.

• If there is no pending proceeding and a tenant provides a Hardship Declaration to the landlord, the landlord is prohibited from commencing any proceeding until May 1, 2021.
• If the tenant does not provide a Hardship Declaration, the landlord is required to file and serve the following to commence an action:
• affidavit of service of the Hardship Declaration in English and the language of the commercial lease / tenancy agreement;
• affidavit of service of predicate notices required by law and the lease;
• affidavit of the landlord / landlord’s agent attesting to the following:
• Landlord / his agent did not receive a Hardship Declaration from the Tenant; or
• The tenant returned the Hardship Declaration but the tenant is “persistently and unreasonably engaging in behavior that substantially infringes on the use and enjoyment of other tenants or occupants or causes a substantial safety hazard to others, with a specific description of the behavior alleged.”
• If the Court determines that the landlord failed to provide the Hardship Declaration to the tenant, the Court shall stay the proceedings for at least 10 business days to allow the tenant to complete the Hardship Declaration.

• Refers to proceedings commenced on or before March 7, 2020 and commenced within 30 days of March 10, 2021.
• Stayed for at least 60 days, or to such later date the Court deems necessary to provide tenants time to complete and submit the hardship declaration.
• Court shall issue stay and mail copy of the Hardship Declaration to the tenant.
• If the tenant provides a completed Hardship Declaration to the Court or landlord, the matter is stayed until May 1, 2021.

• In any proceeding in which an eviction warrant has already been issued, execution is stayed until the court holds a status conference with the parties.
• If the tenant provides a Hardship Declaration, the execution of the warrant is stayed until May 1, 2021.
• For the sheriff to execute the warrant of eviction, it must now state:
• The tenant has not submitted a Hardship Declaration and the tenant was properly served with a copy of the Hardship Declaration, listing dates of service by the petitioner and the court; or
• The tenant is ineligible for a stay under this act because the court determined that the tenant is persistently and unreasonably engaging in behavior that infringes on the use and enjoyment of other tenants/occupants or causes a safety hazard to others with a specific description of the behavior.

Governor Cuomo has signed into a law Assembly Bill A5630A which aims to simplify the statutory short form power of attorney and increase its acceptance by third parties (looking at you title insurers and banks). 

Previously, a power of attorney could be void because it did not contain the "the exact wording of the form set forth in Section 5-1513". This strict language caused many third parties relying on the form to refuse to honor powers of attorney not prepared using their own templates out of fear that the form they were unfamiliar with had a small technical error rendering it invalid. 

Now, a power of attorney is valid so long as it "substantially conforms to the form required pursuant to Section 5-1513" even if it contains insignificant mistakes in "wording, spelling, punctuation, or formatting, or the use of bold or italic type... or uses language that is essentially the same as, but not identical to, the statutory form." Even more, "failing to include clauses that are not relevant to a given power of attorney shall not in itself cause such power of attorney to be found to not substantially conform with the requirements of such form." Long story short, the statute now gives much more leeway in the preparation of the form, hopefully avoiding the voiding of powers which in all fairness should have been valid for the purpose intended. 

To promote acceptance of more powers of attorney, the new bill bakes in protections for third parties relying upon powers, as well as penalties for third parties that unreasonably reject powers. 

Section 5-1504 of the General Obligations Law is amended to contain a presumption that a duly acknowledged (notarized) power of attorney is genuine and valid. It also is amended to provide for a mechanism to release a third party relying upon a power of attorney from liability after reasonable acceptance. The third party may "request, and rely upon, without further investigation" (1) an agent's certification under penalty of perjury any factual matters relating to the power and (2) an opinion of counsel (from the principal is fine) as to any matter of law concerning the power. There are strict time limits (10 business days) in which the third party must reject a power of attorney together with a written explanation given to the principal and agent, and then either reject or honor the power after receipt of written explanation received from the agent/principal (7 business days). Most importantly, if the agent receives an acknowledged affidavit from the agent stating that the power is in full force and effect, the third party must accept the power of attorney except for reasonable cause, which is enumerated in the statute. If the third party and agent/principal follow all the steps in this dance, the "third party shall be held harmless from liability for the transaction." 

But what if your bank or title insurer still won't accept your power of attorney? A special proceeding may be commenced against the third party refusing to honor the power, awarding damages (including reasonable attorney's fees and costs) if the third party acted unreasonably in refusing to honor the power of attorney. 

Time will tell if these changes, coupled with the elimination of the statutory gift rider, will result in more widespread use and acceptance of powers of attorney. Banks and title insurers are notorious for avoiding risk when it comes to the use of powers of attorney and the State's attempts to promote their acceptance has bordered on Sisyphean. 

Qualifying Listing. The term “qualifying listing” means a listing or advertisement that offers a short-term rental via a booking service, and:
1. such listing or advertisement offers or appears to offer the short-term rental of an entire dwelling unit or housing accommodation, or
2. such listing or advertisement offers or appears to offer a short-term rental for three or more individuals at the same time.