Corporate Transparency Act Deadlines You Can't Miss

Last Call for Compliance: Corporate Transparency Act Deadlines You Can’t Miss

As we approach the end of the year, it’s time for a critical reminder about the Corporate Transparency Act (CTA)—a law that requires most businesses in the U.S. to disclose information about their beneficial owners. Whether you’ve already heard about the CTA or it’s news to you, this blog covers the essential details and deadlines you need to know to ensure your business stays compliant and avoids hefty penalties.

What Is the Corporate Transparency Act?

The CTA, which took effect on January 1, 2024, aims to increase transparency in business ownership to combat financial crimes like money laundering and fraud. Under the law, most corporations, limited liability companies (LLCs), and similar entities formed or registered in the U.S. must report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN).

Who Needs to File?

The CTA applies to most small businesses, including corporations, LLCs, and partnerships, with certain exemptions for large, publicly traded companies, regulated entities (like banks), and others. If your business is not exempt, you must file a report with FinCEN disclosing information about your company’s beneficial owners—individuals who exercise substantial control over the company or own at least 25% of it.

Key Deadlines You Need to Know

1. Newly Formed Entities:
       If your business was formed or registered after January 1, 2024, you must      submit a BOI report within 90 days of receiving notice of formation or registration. If you are planning to form a business after January 1, 2025, you must submit a BOI report within 30 days of receiving notice of formation or registration. This is a rolling deadline, so it’s crucial for newly established businesses to act promptly.
2. Existing Entities Formed Before January 1, 2024:
       If your business was formed before the start of 2024, the deadline to submit your BOI report is January 1, 2025. This gives you time to gather the necessary information, but don’t delay—missing this deadline could result in significant fines and criminal penalties.
3. Changes to Beneficial Ownership:
       If there are changes to your company’s beneficial owners or their information (like a change of address), you must file an updated report within 30 days of becoming aware of the change.

What Information Must Be Reported?

For each beneficial owner, you’ll need to disclose:

• Full legal name
• Date of birth
• Residential address
• An identifying number from a valid government-issued ID (e.g., driver’s license or passport)

FinCEN will store this information in a confidential database that can only be accessed by authorized government agencies and financial institutions for compliance purposes.

Where to File Your Report

All BOI reports must be filed directly with FinCEN. You can complete the filing online through the FinCEN website. Here’s the link to file your report: FinCEN BOI Filing Portal.

What Happens If You Don’t Comply?

Failing to comply with the CTA can result in severe penalties:

• Civil fines: Up to $500 per day until the violation is corrected
• Criminal penalties: Fines up to $10,000 and/or up to two years in prison for willful failure to report or providing false information

These are penalties you want to avoid, especially when compliance is straightforward with the right legal guidance.

Free DIY Guide from Our Firm

To help you navigate this new reporting requirement, our firm offers a free DIY guide for submitting your Beneficial Ownership Information (BOI) report to FinCEN. The guide breaks down the filing process step-by-step, making it easier for you to comply with the law. To receive your free copy, simply email contact@dolevlaw.com.

Final Thoughts

The Corporate Transparency Act’s reporting requirements mark a significant shift in business compliance. As the year draws to a close, make sure your business is prepared to meet these deadlines and avoid costly penalties. With a clear understanding of the CTA, timely reporting, and the right guidance, you can ensure your business stays in good standing.

Disclaimer:
The information provided in this blog is for general informational purposes only and should not be considered legal advice. While we strive to provide accurate and up-to-date information, the content may not reflect the most current legal developments or address specific situations. For personalized advice regarding the Corporate Transparency Act or other legal matters, please consult with a qualified attorney. Compliance requirements can vary based on individual circumstances, and it is important to seek professional guidance to ensure full legal compliance.