The U.S. Congress enacted the Corporate Transparency Act (CTA) to establish and maintain a national registry of beneficial owners of entities that are considered to be “reporting companies.” Historically, the U.S. has lagged behind other developed countries in its safeguards to prevent money laundering and other illicit financial activities. The CTA is designed to improve the U.S. government’s ability to do so.
Information collected pursuant to the CTA will be stored in a database controlled by the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) and is available to regulators and law enforcement under limited circumstances.
The CTA states that all entities formed prior to January 1, 2024, must make a filing on or before January 1, 2025 (unless the entity meets an exemption under the CTA). Entities formed in 2024 must make a filing within 90 days of formation (unless the entity meets an exemption under the CTA).
FinCEN offers instructions about the filing requirements and exemptions, provides FAQs, and guidance for small businesses. To avoid penalties under the CTA, please take a few minutes to understand the reporting obligations related to your entity or entities.
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