There is a significant change in federal law that will have an impact on nearly everyone operating a business.

The Corporate Transparency Act (“CTA”) became effective on January 1, 2024, which requires most companies to comply with the new reporting requirements.  The CTA requires corporations, limited liability companies, partnerships, and trusts (entities registered with the Secretary of State) to file informational reports with the Financial Crimes Enforcement Network (“FinCEN”) about its beneficial ownership information (“BOI”).   

A reporting company created or registered to do business before January 1, 2024, will have until January 1, 2025, to file its initial BOI report.  Reporting companies created after January 1, 2024, and before January 1, 2025, will have 90 calendar days after the company’s creation to file its initial BOI report.  Reporting companies created after January 1, 2025, will have 30 calendar days from the company’s creation to file their initial BOI reports with FinCEN.  Compliance with the CTA is mandatory for qualified businesses and significant fines and civil and criminal penalties can be imposed for businesses and persons who fail to comply with the CTA or that falsify information reported.

You can file and obtain further information from FinCEN at https://fincen.gov/boi.  The official FinCEN website does not have a filing fee.

There are 23 listed exemptions from filing the BOI report.  Two of these exemptions are:

  • Tax-Exempt Entity
  • Large operating company (must be all three)
    1. Employs more than 20 full-time employees in the U.S.
    2. Has an operating physical office in the U.S. and
    3. Filed a federal income tax return in the U.S. for the previous year showing more than $5 Million in gross receipts or sales.

Please note that filing and maintaining beneficial ownership information is a responsibility that resides with you, individually, as a business owner. We are not filing these reports for our clients.  If you have questions about the BOI report, please call our office.