On September 13, 2019 the Governor signed into law a bill that requires all limited liability companies to disclose its members, managers and any other authorized persons when they buy or sell residential real property in the State of New York.
Below are a few FAQ that you and your clients might find helpful:
What disclosure is required?
All LLCs are required to disclose the names and business addresses of all members, managers and any authorized persons.
When is the disclosure made?
The disclosure must be made at the time the deed is recorded. No deed to transfer 1-4 family residential real property will be accepted for recording without this information.
Does this affect all types of property?
No. The new law only requires disclosure for transfers of 1-4 family residential real property.
When does this law take effect?
As of September 23, 2019.
How is the information disclosed?
It is anticipated that the TP-584 transfer tax forms will be updated to include a section for the name and business address of all members, managers and authorized persons of the LLC. However, since those forms are not yet updated and the law is effective now, some counties have indicated that they will require a list of the names and addresses of all members, managers and authorized persons of the LLC to be listed on a sheet to accompany the TP-584
Do both buyers and Sellers need to provide this information?
Yes.
Will title companies require this information prior to closing or insuring a transaction?
Yes. Since no deed can be recorded without this information, Core Title Services will not be able to insure any transaction where this information hasn't been provided to us, at or prior to closing.
What will be done with this information?
The statute is unclear - it appears it will be retained by the County Clerk's office and/or the New York State Department of Finance.
There are a lot of questions surrounding this bill. As we receive any information, we will pass on to all of our clients and friends.
For your convenience, we have attached pdf and word versions of a sample addendum form that you can use for future transaction.
If you have any questions on this, please do not hesitate to call our office and ask to speak with underwriting counsel.
Warmest Regards,
Larry, Andrew and Ira
