The Corporate Transparency Act (CTA), integral to the National Defense Authorization Act for Fiscal Year 2021, introduced pivotal changes to reporting requirements for corporations and LLCs. These requirements have come into effect for 2024 and beyond. The regulations are administered by the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) to safeguard financial systems from illicit use, combat money laundering, and promote national security.
As your trusted advisors, The Green Law Group is committed to guiding you through these changes to promote full compliance. Businesses can file these mandatory reports at no cost either online or via a downloadable PDF through the Financial Crimes Enforcement Network (FinCEN) website.
Who Needs to Comply?
The CTA applies to corporations, LLCs, and other similar entities registered through a state filing process, as well as foreign entities conducting business in the U.S. Exceptions exist for certain publicly traded companies and other federally regulated entities.
Reporting Requirements: What You Need to Disclose
Entities subject to the CTA must provide detailed information for each beneficial owner, including:
- Full legal name
- Date of birth
- Current address
- Identifying number from an approved document (e.g., passport, driver’s license)
A beneficial owner is defined under the CTA as an individual owning at least 25% of the entity’s equity interests or who exercises significant control over the entity.
Confidentiality and Data Access
Information submitted to FinCEN under the CTA is not publicly accessible, being available only to certain federal and law enforcement agencies, under specific conditions.
Penalties for Non-Compliance
Entities that fail to comply could face significant civil and criminal penalties, including fines and possible imprisonment.
Filing Deadlines and Procedures
- Existing Entities must file by January 01, 2025.
- New Entities (created in 2024) are required to file within 90 days of formation.
- Updates to ownership information must be reported within 30 days of any change.
To facilitate these reporting requirements, businesses can file online or download, complete, and submit a PDF form through FinCEN’s website at https://boiefiling.fincen.gov/. There is no fee to file.
Preparing for Compliance
Businesses should:
- Identify beneficial owners.
- Gather the required information.
- Set up compliance protocols internally.
- Keep informed about the latest FinCEN regulations.
Conclusion
The CTA is a significant step toward greater corporate transparency and the prevention of financial crimes. As we await final regulations, preparing for these changes is imperative. The Green Law Group is here to assist you in understanding and fulfilling your obligations under the CTA.
Contact Us
For detailed guidance and support with the CTA’s requirements, including assistance with online or PDF filings, please reach out to us. Our experts are ready to help you navigate these regulatory waters with confidence.
Note: This content focuses on providing information about online and offline filing options for compliance with the CTA. For any specific queries regarding the process or associated information, clients are encouraged to contact The Green Law Group directly.