Will New Rules for LLCs Change the Luxury Real Estate Landscape?

(DNAINFO) Amy Zimmer — Facing growing criticism over the lack of transparency and the growing use of limited liability companies — LLC’s — in the city’s luxury real estate market, the de Blasio administration implemented new disclosure requirements on shell companies buying or selling property here, the New York Timesreported Monday.

More than half of New York condos above $5 million were sold to LLCs last year, noted theTimes, which produced a series on how the high end condo market’s “veil of secrecy” allowed foreigners to park money here that was obtained through criminal activities.

Under the new rules, implemented in May, the names of all members of shell companies, along with their taxpayer identification numbers, must be provided to the city’s Finance Department, though not to the public.

The goal is to help the city find the owners who might be avoiding city income taxes by claiming this is not their primary residency, city officials noted. An estimated 89,000 condo and co-ops — valued at $20 billion based on city tax assessment data — are owned by people who claim to live in the city fewer than 183 days a year and can therefore avoid city income taxes, the Times said.

Source: Will New Rules for LLCs Change the Luxury Real Estate Landscape? – Columbus Circle – New York