Important 1099-S, FDIC Reminders & SB 264 Foreign Interests Resources
Dear Members,
Well, my trip to upstate NY and Vermont did not yield much cooler weather but it was a good break nonetheless! Came back to lots of stuff going on so let's start with the most important one:
LAST CHANCE to avoid a major 1099-S headache! Aug. 1, 2023 is fast approaching. As previously reported, if you received your IRS FIRE reporting system Transmitter Control Code (TCC) before Sep. 26, 2021 your existing TCC code will expire in August unless your reapply on the IRS website. If you complete the application before Aug. 1, you will keep your existing TCC for reporting next year’s batch of 1099-S reports. Here is a link to the Dec. 2022 Fund Concept article which explains the problem and the process. Note: you must now have an ID.me account before you can start the re-application.
This is not an easy process and should not be put off much longer. Read all the information on the IRS website paying particular attention to the “Responsible Official (RO)” information. If problems are encountered, the IRS phone line (866-455-7438) for help is much more accessible this time of year. You can also email RegulatoryCompliance@thefund.com for assistance.
Final Note on this: electronic filing is required if you close 10 or more transactions in 2023. If you have been filling paper returns you too will need to obtain a TCC code for 2024 filing season. Use the IRS website link to get started.
FDIC insurance coverage on bank accounts. Remember this issue? I just attended an ALTA meeting at which a banker reviewed the requirements applicable to those professions holding monies in trust or in escrow on behalf of others (i.e., title agents and attorneys). Here is a reminder: If you are holding money for a client/buyer/seller, you should verify with which bank that third party does business - and if it is the same as your bank, remind/inform them that their money you are holding is aggregated with their other deposits for purposes of the $250,000 limit FDIC insurance. Monies you are holding very short term are probably "ok." Another nuance: if there are 5 owners of an account or monies you are holding (e.g., 5 buyers), each one of them would get $250,000 of insurance so the balance in that account/ledger might be covered up to $1,000,000.
Foreign interests in property. Members have been sending in great questions about various situations to which the law may apply. But many of you are asking about basic information and resources so here is a link to our webpage that has everything we know so far…
https://www.thefund.com/foreigninterests. Also, we are planning a webinar on August 16 at noon to go over the questions we have received and provide whatever update we may have at that point. So pencil this in. Registration information will come later!
That's all for this week.
Let me know how we can help you.
Melissa Jay Murphy
Executive Vice President, Chief Legal Officer,
and General Counsel
07/13/2023