Corporate Transparency Act

WHAT IS THE CTA?

CORPORATE TRANSPARENCY ACT

The CTA is a relatively new law, passed by Congress and enacted in January of 2021, that will impose new reporting requirements upon millions of preexisting

and future entities, including corporations, LLCs, LLPs, and business trusts. It mandates a one-time initial report and has harsh penalties for noncompliance. Businesses that fail to report the required information or provide false or fraudulent information will be subject to a civil penalty of $500 per day during the period of noncompliance.

IMPORTANT DATES

• CTA effective date: January 1, 2024
• For entities existing before 2024 - Reports are due: January 1, 2025 (1 year from effective date)
• For entities formed on or after January 1, 2024, and before January 1, 2025 - Reports are due: 90 days from the date of formation
• For entities existing as of January 1, 2025 - Reports are due: 30 days from the date of formation
• Updates to existing reports due: 30 days from the date of the change

WHAT NEEDS TO BE REPORTED?

ONE-TIME BOI REPORT

Reporting Companies are required to disclose the following information in their one-time report:

1. Reporting Company - Name, Address, Tax ID number
2. Beneficial Owners - Name, Date of Birth, Address, ID number and copy of ID document
3. Company Applicants (ONLY for entities created ON or AFTER January 1, 2024) - Name, Date of Birth, Address, ID number and copy of ID document

WHO IS EXEMPT FROM REPORTING?

Exempt companies are generally larger companies that are already subject to similar reporting requirements pursuant to other legislation, like the Sarbanes-Oxley Act, or equivalent SEC reporting requirements. Additionally, qualifying dormant/inactive entities are exempt from reporting. A complete list of exemption requirements can be found on fincen.gov.