This serves as a timely reminder for business owners to ensure compliance with the Corporate Transparency Act (“CTA”) by submitting their Beneficial Ownership Information Reports (“BOIRs”) on the Financial Crimes Enforcement Network (“FinCEN”) website before the January 1, 2025 deadline. With about two months remaining, it's important to determine whether your business is subject to this requirement and, if so, to start gathering the necessary information. Please do not delay.
As a reminder, the CTA is a new federal law that requires businesses to submit BOIRs to FinCEN, which provide information about both the entity and the individual(s) who own and control them. Although there are a number of exemptions, it’s important to note that the CTA looks at each entity individually. So, it requires you to review each entity in your organizational structure because one of them may nevertheless have reporting requirements due to the unique nuances of the CTA.
Back in September, FinCEN had reported that only around 10% of the estimated 32 million entities had filed a BOIR. It is imperative that business owners act now to determine whether the CTA applies to their entity, collect the information required on a BOIR, and submit it to FinCEN before the January 1, 2025 deadline. Many in the legal community are expecting the complexity of the law and potential filing bottlenecks to cause major disruptions to ensuring compliance.
The urgency to begin the filing process is compounded by the potential penalties that come with willful reporting non-compliance, including a civil penalty up to $500 per day a violation continues and even a criminal penalty of up to $10,000, imprisonment for up to two years, or both.
To be clear, we will not be responsible for reporting your company’s information to FinCEN. That is a requirement you or someone in your company will need to complete, though we are here to assist you with this process.
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