Is My Business Required to Report Information Under the Corporate Transparency Act?
In 2021, the Corporate Transparency Act was passed, requiring most corporations and LLCs to file information about their “beneficial owners” with the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of Treasury.
The filing requirements were delayed for three years while the regulations were written and finalized. Now the law is taking effect.
Starting on January 1, 2024, newly formed or registered reporting companies in the U.S. will have 90 days to report BOI, certain entity information about the reporting company and company applicant information to FinCEN0
Domestic “Reporting Companies” who will be required to file reports are generally:
· LLCs or
· other entities formed by filing documents with a state Secretary of State or a tribal equivalent.
There are exemptions for SEC-reporting companies, regulated financial service companies, tax-exempt companies, insurance companies, accountants, large companies (with at least 20 US employees and at least $5 million in gross revenues) and other kinds of companies that are already required to report similar information. Certain inactive companies are exempt as well.
A foreign reporting company is any entity formed under the law of a foreign country and registered to do business in any U.S. state by the filing of a document with a secretary of state or similar office.
These companies will have to report the full legal name, current residential address, date of birth, and driver’s license/passport/state or tribal identification document information of the company’s beneficial owners and for companies formed on January 1, 2024 and after, of the company applicant (more on both of these next week).
Legal Direction is able to assist small business owners determine if they are a reporting entity, and in the coming weeks we will post more information about this act and what it requires. At this time, we are not filing BOI reports for existing or new companies.
Here is the Small Entity Compliance Guide from FinCEN.