Contact:
Alison Arden Besunder
212-695-8100, ext. 289
[email protected]
Aaron Boyajian
212-695-8100, ext. 258
[email protected]
The Corporate Transparency Act (CTA) (www.fincen.gov/boi) is now in effect, bringing forth pivotal changes in reporting obligations for diverse entities. At Goetz Fitzpatrick LLP, we recognize the intricate landscape this legislation introduces and are committed to guiding our clients through its nuances. The CTA mandates beneficial ownership reporting, aiming to bolster transparency and combat financial misconduct. If your entity falls within the scope of this regulation or requires assistance with the Beneficial Ownership Information (BOI) report, our adept team stands ready to assist. Reach out to us for support and guidance on CTA compliance.
What Is the Corporate Transparency Act: Your Comprehensive Compliance Guide
The Corporate Transparency Act (CTA), implemented on January 1, 2021, under the National Defense Authorization Act, substantially reforms anti-money laundering laws. Its primary aim is to curb money laundering, terrorist financing, corruption, and tax fraud by mandating beneficial ownership reporting for various entities operating in the United States.
Key Points:
Effective Dates: The reporting obligations came into force on January 1, 2024. Entities formed before this date have until January 1, 2025, to comply.
Filing Requirements: Filing deadlines differ based on entity formation dates, with a grace period provided for entities established in 2024.
Reporting Companies: Various domestic and foreign entities, known as reporting companies, are mandated to submit beneficial ownership information to FinCEN.
Exemptions: Several categories, such as banks, tax-exempt entities, and certain partnerships, are exempt from reporting. A “large operating company” is also excluded based on specific criteria.
Tax-Exempt Entities: Tax-exempt entities must monitor their status; if they lose their exemption, they need to report within 180 days.
Information Required: Details about the company, beneficial owners, and company applicants are needed, including identification documents, such as a registration certificate.
Submission Method: Reports must be submitted electronically through FinCEN’s Beneficial Ownership Secure System (BOSS).
Access and Confidentiality: The disclosed information is accessible to authorized recipients for defined purposes, with security and confidentiality protocols.
Updates and Corrections: Reporting companies must promptly update or correct any inaccuracies or changes within specific time frames.
Penalties: Non-compliance, including false reporting, can result in civil or criminal penalties.
FinCEN Identifier: While not mandatory, a unique FinCEN identifier may be obtained and utilized to streamline reporting processes.
Conclusion:
The CTA’s implementation imposes stringent reporting requirements on various entities, aiming to enhance transparency and combat financial crimes. Understanding these obligations and adhering to reporting timelines and accuracy is crucial to avoid penalties and ensure compliance with the law. In all instances, businesses and entities should familiarize themselves with the law’s provisions and seek legal counsel to ensure adherence to regulatory requirements.
For entities which Goetz Fitzpatrick forms for its clients after January 1, 2024, we will work to guide them through the CTA compliance process. For entities which were formed prior to January 1, 2024, you may be contacted by our office to assist in the CTA compliance process, however, if not, we strongly recommend that you contact us to assist you in the CTA compliance process so that you avoid potential non-compliance and the rigorous penalties which accompany non-compliance.
Goetz Fitzpatrick has been practicing law throughout the New York Metropolitan area and The Hamptons, since 1967. The firm has deep expertise in Construction and Real Estate, as well as Corporate, Bankruptcy, Trust & Estates and Labor & Employment. The firm’s office is located at One Penn Plaza, Suite 3100, New York, NY 10119, Telephone 212 695 8100.
