In January 2024, the Corporate Transparency Act (CTA) will go into effect and require millions of businesses to file a Beneficial Ownership Information (BOI) report. This legislation, enacted in 2021, aims to create transparency in business ownership to combat illicit activities such as money laundering, tax fraud, and more.
To ensure your business is compliant with the CTA and to discuss your potential reporting requirements, call the Strategic Tax Planning team at (202) 455-6010 or fill out this contact form.
What is a Beneficial Owner?
Once the CTA goes into effect, businesses must report information regarding their beneficial owners to the Financial Crimes Enforcement Network (FinCEN), a bureau of the US Department of Treasury.
The beneficial owner of a reporting company is defined as an individual who either:
- Has substantial control over the company, or
- Owns or controls at least 25% of the company’s interests
You can read frequently asked questions about identifying beneficial owners on the FinCEN website here.
Effective Dates and Deadlines to Know
The Corporate Transparency Act will go into effect on January 1st, 2024.
Businesses established prior to that date must report the required information via a Beneficial Ownership Information (BOI) form before January 1st, 2025.
Businesses established in or after 2024 will have 30 days after receiving notice of their registration to file a BOI form.
Ensure Your Business is Compliant with the CTA
The Corporate Transparency Act is a significant step towards combating financial crimes. However, there are dozens of exemptions and significant penalties for noncompliance so you may want to consult with professionals when navigating these new reporting requirements.
If you would like to talk to the financial professionals about CTA compliance, please call us at (202) 455-6010 or fill out our contact form.