The Corporate Transparency Act is something every small business needs to understand. This is essentially an anti-money laundering law.
The new legislation requires many businesses submit a Beneficial Ownership Information Report to the U.S. Dept. of Treasury’s Financial Crimes Enforcement Network (FinCEN), providing details identifying individuals who are associated with the reporting opany.
The form is available at fincen.gov/boi.
Companies established before Jan. 1, 2024 have until Jan. 1, 2025 to report beneficial ownership information.
Companies established after Jan. 1, 2024 must report withing 90 days of registering with the state. This means the deadline is looming for businesses that launched in January 2024.
Companies established in 2025 will only have 30 days to report.
Companies must report by stating beneficial owners defined as:
- Owns 25% or more of the company.
- A person who has a major influence on company decisions or operations.
- A commensurate control of a company’s equity.
Companies that are exempt include sole proprietorships, unincorporated associations, nonprofit organizations, wealth planning trusts and publicly traded companies. To see a list of others, visit fincen.gov.
