I am sure that over the past few days, you have either received an email or read an article stating that you need to immediately contact your attorney or CPA. If you have an LLC or Inc. Well, that’s not exactly accurate. There’s no need to panic just quite yet.
With the effective date of the Corporate Transparency Act (CTA) approaching at the start of 2024, it is necessary to start to examine what needs to be done so you can be compliant by no later than January 1, 2025. This when reporting requirements for existing LLCs and Incs goes into effect.
Domestic entities that are subject to reporting include corporations (both C corporations and S corporations), limited liability companies (LLCs), and other entities formed by the filing of a document with a Secretary of State. Similar foreign entities that are registered to do business in any state or tribal jurisdiction are also subject to the reporting requirements.
LLCs and Incs must disclose the following information regarding the entity: legal name, trade name, business address, jurisdiction information, and US Internal Revenue Service taxpayer identification number.
This information needs to be submitted for anyone who is a Beneficial Owner of the Inc or LLC and anyone who owns more than 25% of the shares of the Inc or has substantial control over the company.
Companies created or registered in 2024 will have 90 calendar days from the date of receiving actual or public notice of their creation or registration becoming effective to file their initial reports.
So if you have an LLC or Inc, please make sure you contact your attorney or CPA to submit the necessary information to FinCEN prior to January 1, 2025. If you plan on starting an LLC or Inc in 2024 be aware that your information will need to be submitted to FinCEN within 90 days of the formation of your Inc or LLC.
We can certainly handle the submission of your information if you choose not to do it yourself.
Be aware that the civil penalty for a violation is $500 per day, while criminal penalties include fines of up to $10,000, imprisonment for up to two years, or both. If a report is filed that contains inaccurate information and the reporting company did not have actual knowledge the information was incorrect, it will be given a 90-day safe harbor to submit an accurate report.
Click here for a comprehensive guide from FinCEN – https://www.fincen.gov/sites/default/files/shared/BOI_Small_Compliance_Guide_FINAL_Sept_508C.pdf
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