Corporate Transparency Act

Recently enacted, the Corporate Transparency Act (the “CTA”) mandates that, effective January 1, 2024, many legal entities (corporations, limited liability companies and limited partnerships) must timely file Beneficial Ownership Information Reports (“BOIRs”) containing information about the company as well as its key owners, decisionmakers and the people who formed it. Below are three important items to consider as anyone associated with a “Reporting Entity” (defined below) starts planning for compliance with these new BOIR filing requirements.

First, the CTA’s reporting requirements apply only to a “Reporting Company,” which term the CTA defines to include any corporation, limited liability company, limited partnership and any other entity that is created by the filing of a document with a secretary of state or similar office under the laws of a state or an Indian tribe, and any “non-exempt” foreign entity registering to do business under the laws of a state or an Indian tribe. However, the CTA expressly exempts many (but not all) entities that would otherwise fall under the definition of a “Reporting Company.” In addition, certain business associations (such as sole proprietorships and general partnerships) and trusts that are not formed pursuant to a state or tribal filing will not be treated as “Reporting Companies.”

Second, if your entity is a Reporting Company created:

• On or after January 1, 2024, your entity’s initial BOIR will need to be filed with FinCEN within 90 days of its creation.  
• Before January 1, 2024, your entity’s initial BOIR will need to be filed with FinCEN on or before December 31, 2024.

Third, once your entity has filed its initial BOIR, you will not need to update that BOIR on any recurring basis.  However, you will need to file an updated or corrected BOIR, as the case may be, within 30 days of any change to your entity’s most recently filed BOIR, or you becoming aware of or having reason to know of any inaccuracy in, your entity’s most recently filed BOIR.

We will be happy to assist you with analyzing whether your entity is a Reporting Company subject to the CTA and, if so, what information will need to be included in your entity’s BOIR.  We also intend to work with one or more third-party CTA “compliance vendors” to develop means of compiling the necessary information for your entity’s BOIR and then filing the completed BOIR with FinCEN if you do not wish to do so by yourself.  Please contact your WKBKY attorney to discuss how we can assist you with preparing for the CTA.