The Corporate Transparency Act (CTA) is a new law that requires certain companies formed or operating in the United States to report information about their beneficial owners to the Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN).
The law aims to safeguard the financial system from illicit use, combat money laundering and its related crimes including terrorism, and promote national security. FinCEN is now accepting beneficial ownership information reports.
Beneficial ownership information refers to identifying information about the individuals who directly or indirectly own or control a company. Those companies required to report this information are referred to as “reporting companies” and are defined as:
- Domestic reporting companies are corporations, limited liability companies, and any other entities created by the filing of a document with a secretary of state or any similar office in the United States.
- Foreign reporting companies are entities (including corporations and limited liability companies) formed under the law of a foreign country that have registered to do business in the United States by the filing of a document with a secretary of state or any similar office.
A reporting company created or registered to do business before Jan. 1, 2024, will have until Jan. 1, 2025, to file its initial beneficial ownership information report.
A reporting company created or registered on or after Jan. 1, 2024, and before Jan. 1, 2025, will have 90 calendar days after receiving notice of the company’s creation or registration to file its initial report.
Members are urged to visit the FinCEN website to determine whether your company falls under the reporting requirement provisions and to access complete information on the filing requirements. The site contains an excellent Frequently Asked Questions (FAQ) resource to quickly access answers to reporting and filing questions.
As with all legal matters, please consult your attorney or other advisor should you have any questions about your responsibilities in reporting beneficial ownership information.