In 2021, Congress approved of a statute requiring the Corporate Transparency Act (CTA), which will require small businesses to file beneficial owner information with the Financial Crimes Enforcement Network (FinCEN).  The aim of the CTA is to prevent bad actors from concealing the identities of those responsible for business entities in the United States who may engage in tax fraud, money laundering, funding of terrorism, or other illegal activities.

The reporting requirement goes into effect on January 1, 2024.  With a few exceptions, all small businesses will be required to report.

For more information, you’ll find our FAQs below and more detailed information on the FinCen Beneficial Ownership Reporting web age.  FinCEN has also prepared a very helpful Small Entity Compliance Guide which contains valuable information.

FACT:  Beneficial ownership reporting begins January 1, 2024.  No filings will be accepted before that date.

FACT:  Reporting entities formed before January 1, 2024 will have until January 1, 2025 to file.

FACT:  Reporting entities formed or registered on or after January 1, 2024 must file within 30 days of the date of creation or registration.

FACT:  Some entities may be exempt from this reporting requirement. See FAQs below for more info.

What can you do to prepare?

First and foremost, it is important to educate yourself regarding the requirements.  The information you’ll find here will be helpful, but you will find more details and an extensive FAQ on the FinCEN website.  FinCEN also has a contact form for questions relating to the BOI reporting requirements.

Second, existing companies should decide when they plan on reporting and begin gathering the information needed for the report.  Some entities may decide to file later in 2024 to avoid being part of an early rush to file.

Please visit our full CTA FAQs for more information.  We also strongly urge you to sign up for FinCen’s news updates.