New 2024 Business Law

The Corporate Transparency Act (CTA), effective from January 1, 2024, mandates many small businesses to file a Beneficial Ownership Information (BOI) report with the U.S. Department of Treasury's Financial Crimes Enforcement Network (FinCEN).

Businesses operating in the United States must meet two primary criteria:

1. The business must be a legally created entity, such as a corporation, limited liability company (LLC), or other similar entity, formed by filing a document with a secretary of state or similar office under the laws of a state or Indian tribe.

2. The business must be a "reporting company" that does not fall under any of the exemptions listed under the CTA, which includes certain larger companies, inactive entities, and regulated entities like banks and insurance companies.

Has EITHER:

Fewer than 20 full-time employees, OR

Less than $5 million in gross receipts or sales, as identified in the company’s U.S. tax return.

If a company meets both of the above requirements, it is required to register.

Businesses that meet these criteria are required to report information about their beneficial owners (individuals who own or control a significant portion of the company) directly to FinCEN. Failure to comply with these reporting requirements can result in significant penalties.“Business Entity” such as a corporation, limited liability company (“LLC”), or any other type of company that is “formed by the filing of a document with the Secretary of State, a similar state agency, or an Indian tribe.”

What are the Registration Deadlines?

Entities Formed Before January 1, 2024 – One year after the CTA goes into effect.

i.e. Before January 1, 2025

Entities Formed After January 1, 2024, but Before January 1, 2025 – 90 days after formation.

Entities Formed After January 1, 2025 – 30 days after formation.

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