Happy Friday!
This week I've gotten many emails asking if the Corporate Transparency Act emails clients are getting are legit. It is, and chances are you need to file your beneficial ownership report.
Who has to file?
Most businesses- corporations, LLCs (to include real estate entities) and partnerships.
It's easier to list who's not required to file which is essentially businesses that report to another regulatory body: government entities, publicly traded companies banks, credit unions, insurance companies, accounting firms, public utilities, venture capital fund advisors, investment advisors, etc.
One exemption is "large operating entities" which are companies who employ more than 20 people, have gross sales of over $5 million and are located in the US.
Why is this required?
Corporate oversight- this group reports up to the Financial Crimes Enforcement Network and it's objective is to "help US law enforcement combat money laundering, the financing of terrorism and other illicit activity".
What's the ongoing requirement?
This is the important one to tuck in the back of your head: anytime a business or owner's information changes you have 30 days to report it. That means a business OR PERSONAL phone number, address, anything asked about on the application. This is a biggie and the penalties for non-compliance are large enough that please remember to report with those life changes!
Do I need to pay someone to do this for me?
While I don't personally have to file so this is easy for me to say in my opinion most businesses I work with can do it themselves. It gets complicated when you have multiple multiple owners or a board of directors. If you do want help your CPA can probably point you in the direction of someone who can file on your behalf.
What is the deadline?
Existing companies have to file by 1/1/25
New entities need to file within 90 days of operating
Dealing with hurricanes?
You may be eligible for an extension. Check out the alerts on the homepage of the FinCen website for more information.
Good luck!
Natalie