Corporate Transparency Act (CTA) Deadline Fast Approaching

Your business might need to file a Beneficial Owners Information (BOI) Report under the Corporate Transparency Act (CTA) before Jan. 1, 2025.

This is a new filing taking effect if your company is:

1. Registered with your state’s Secretary of State’s office.   This includes a single-member LLC.
2. Less than $5 million in gross receipts.
3. Less than 20 full-time employees.
4. Not listed on the list of exempt companies, see below.

There are 23 categories of businesses exempt from this filing, typically companies that already have a higher regulatory standard, such as financial companies.

See the list of categories here:

1. Securities reporting issuer
2. Governmental authority
3. Bank
4. Credit union
5. Depository institution holding company
6. Money services business
7. Broker or dealer in securities
8. Securities exchange or clearing agency
9. Other Exchange Act registered entity
10. An investment company or investment adviser
11. Venture capital fund adviser
12. Insurance company
13. State-licensed insurance producer
14. Commodity Exchange Act registered entity
15. Accounting firm
16. Public utility
17. Financial market utility
18. Pooled investment vehicle
19. Tax-exempt entity
20. Entity assisting a tax-exempt entity
21. Large operating company
22. Subsidiary of certain exempt entities
23. Inactive entity

What Does Your Company Need to File by the Jan. 1, 2025 Deadline?

If your business meets the criteria above, you need to take one of these two steps by the deadline:

Ask your attorney or registered agent to file the report.

Or

File the report at   https://fincen.gov/boi

The FinCen webpage also has more information.

Every person in your company who is a beneficial owner must file a separate report for each qualifying registered LLC, LLP, LP, and Corporation.

A beneficial owner is someone who:

1. Exercises substantial control over the reporting company

Or

2. Owns or controls at least 25% of the reporting company’s ownership interests

For any new businesses that form after the Jan. 1, 2025 deadline, there will be a certain amount of time to file these reports.

How Often Does My Company Need to File a BOI Report?

Once the BOI report is submitted, the only time you need to go in and update the records is if certain information changes.

Examples of this could be (but are not limited to):

1. A change in beneficial owners
2. Any change to a beneficial owner’s information, such as address, driver’s license, or passport
3. Any changes to the business name or address

What Is the Purpose of These BOI Reports?

The purpose of BOI reporting in the Corporate Transparency Act (signed into law in 2021) is to increase transparency of company ownership and help prevent illegal activities such as money laundering and fraud.

Please consult with your business attorney for help in making sure your business complies with these new regulations and filing requirements.