CORPORATE TRANSPARENCY ACT COMPLIANCE

The new federal regulation is now in effect as of January 1, 2024, known as the Corporate Transparency Act (the “CTA”). This mandatory reporting regulation will very likely impact you and your company(ies).

WHAT IS THE CORPORATE TRANSPARENCY ACT?

The goal of the CTA is to prevent money laundering and financially-related criminal activity. The Financial Crimes Enforcement Network of the Department of the Treasury, known as FinCEN, is creating a national database of company owners. The CTA requires companies to report the personal identifying information of the company’s current Beneficial Owners (BOI), as well as the person responsible for filing the company’s formation documents (the “Applicant”) for entities created after January 1, 2024.

WHO MUST REPORT?

All entities, including limited liability companies (including single-member LLCs), limited partnerships, corporations, and other entities of business interests (i.e. Estates or Trusts with current business interests). The CTA does contain 23 exceptions. Partial reports are unable to be submitted, so it is imperative to have all information available prior to the reporting deadline.

ENTITIES EXISTING PRIOR TO JANUARY 1, 2024

The CTA requires companies to report the personal identifying information of the company’s current Beneficial Owners. This information will be reported via FinCEN’s online portal and will be maintained in a secure database. This database will be made available only to federal, state, and local law enforcement agencies. Reporting companies in existence prior to January 1, 2024, must file their reports by January 1, 2025.

NEW ENTITIES

FinCEN requires newly established entities to report the personal identifying information of the company’s current Beneficial Owners, as well as the person(s) responsible for filing the company’s formation documents. Reporting companies established after January 1, 2024, and created before January 1, 2025, must file their reports within 90 days after formation. Entities established after January 1, 2025, will have 30 days to file their reports.

HOW CAN WE HELP?

Please contact your Kemp Klein Law Firm Attorney or email us at [email protected] if you have any additional questions regarding your company’s reporting obligations or to discuss the process of compliance. Standard Billing Rates will apply.

INFORMATION FROM FinCEN

For Beneficial Ownership Information from FinCEN and direct reporting visit: https://www.fincen.gov/boi

FinCEN has provided direction at the following website: https://www.fincen.gov/boi-faqs

For further information, you may also access FinCEN’s Small Entity Compliance Guide: https://www.fincen.gov/boi/small-entity-compliance-guide

DISCLAIMER

This page does not constitute legal advice or providing legal services. This page is merely a general announcement of a new regulation. Nothing contained within this page constitutes a lawyer client relationship between Kemp Klein Law Firm and the reader. The implementation of the Corporate Transparency Act is still in development. Further, a variety of other federal and state laws and regulations may apply to your particular business activities. You may contact your legal counsel if you have specific questions.