Corporate Transparency Act Creates New Federal Reporting Requirements for Business Owners

Under the newly enacted Corporate Transparency Act (CTA), effective January 1, 2024, many companies registered in the United States as well as some foreign companies doing business in the US will be required to report certain beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN). 

While publicly traded companies, non-profits and certain other organizations are exempt from this reporting, other business entities who are required to report must do so by their reporting deadline. These deadlines vary, depending on when a business entity was formed. For existing companies the reporting deadline is January 1, 2025, but could be as early as April 2024 for certain newly formed business entities. While there has been activity by some lawmakers to delay the effective dates, the deadlines through January 1, 2025 remain as current law. BOI filings must be completed electronically via FinCEN’s website: www.fincen.gov/boi

FinCEN has provided a useful guide for business owners and managers that provides clear guidance, including filing deadlines and who should file. Link to guide here. The guide is user-friendly and online reporting is not expected to be time consuming, however, business owners and managers with additional questions after reviewing the guide, are encouraged to consult with competent legal counsel regarding the CTA and FinCEN reporting. 

Diane West, CPA, Tax Director, contributed to this article.

Stone & Company, LLC, Lexington, Massachusetts - www.stonecpas.com