Corporate Transparency Act January 1, 2025 Filing Deadline Approaching
This year, the Corporate Transparency Act (CTA) imposed new reporting requirements on many companies in the U.S. Enacted to combat money laundering, the CTA is being used to identify people who form, control, or own many companies operating in the U.S. The information is being gathered by requiring companies to report information about their “Beneficial Owners.” The reports are called “Beneficial Ownership Information Reports,” and they are filed online with the Financial Crimes Enforcement Network (FinCEN).
FinCEN allowed a one-year period for existing companies to report, but that period will end soon. For companies that were in existence on December 31, 2023, the reporting deadline is January 1, 2025.
Reporting generally is mandatory for any company whose formation requires filing documents with a state agency, as well as foreign companies that have registered to do business in the U.S. If your company is not covered by one of the CTA’s reporting exemptions, reporting should be completed before the applicable deadline.
For companies that were formed between January 1, 2024, and December 31, 2024, the reporting deadline is 90 days after the company’s formation. For companies formed on or after January 1, 2025, the reporting deadline is 30 days after the company’s formation.
In addition to the initial report filing deadlines, there is a 30-day deadline for reporting changes to information previously reported information and for correcting errors in reports previously filed.
For additional information about the CTA, summaries describing the information required to be reported, and available exemptions from the reporting requirement, please click here.
With the January 1, 2025 deadline rapidly approaching, reporting companies that were in existence in 2023 should determine whether they are exempt. If not exempt, they should gather all the information needed to file CTA-compliant reports well in advance of the deadline. Failure to comply is punishable by a civil penalty of up to $500 per day of violation, fines up to $10,000, and imprisonment for up to two years, or both, for a criminal violation.
If you have questions about compliance with the CTA filing mandates, McMillan Metro Faerber, P.C. can help. Contact us with any questions about preparing for compliance with this new law.
