IMPORTANT INFORMATION FOR YOUR IMMEDIATE ATTENTION AND ACTION: CORPORATE TRANSPARENCY ACT
The Corporate Transparency Act (“CTA”) became effective January 1, 2024, and it requires small domestic businesses (i.e., companies with $5,000,000 or less in annual gross revenues or less than 21 employees) that were created prior to January 1, 2024, and are not otherwise exempt from the CTA’s reporting requirements, to complete and file their initial Beneficial Ownership Information Report (“BOI Report”) with the Financial Crimes Enforcement Network (“FinCEN”) by January 1, 2025. Likewise, for small domestic businesses created during 2024, they must file their initial BOI Report by January 1, 2025 as well.
If you own a corporation, a limited liability company, a limited partnership, or a limited liability partnership, your company will be required to file its initial BOI Report by NO LATER than January 1, 2025.
The BOI Report is a new mandatory business reporting requirement that is applicable to most U.S. companies and requires the reporting of certain information regarding the Reporting Company and the Reporting Company’s “Beneficial Owners” to FinCEN. Under the CTA, Beneficial Owners are individuals (i) who own or control at least 25% of the ownership interests of a Reporting Company or (ii) who exercise substantial control over a Reporting Company. This reporting requirement comes from the CTA, a federal law that was passed to enhance the federal government’s efforts to combat money laundering, terrorist financing, and other financial crimes. The CTA’s filing requirement is enforced by civil penalties of up to $500 per day for each day of noncompliance with the reporting requirements and criminal penalties including imprisonment for up to two years and a fine of up to $10,000.
Companies required to file an initial BOI Report include corporations, limited liability companies, limited partnerships, limited liability partnerships, and other legal entities created by filing a document with the Pennsylvania Department of State or in any other U.S. State. Most for-profit business entities will be required to file an initial BOI Report unless they qualify for an exemption.
Yes, our Firm would be pleased to provide further assistance regarding the CTA’s reporting requirements and to file your initial BOI Report, as well as any updated BOI Reports that are required to be filed when there is any change to previously reported information about your company or its Beneficial Owners.
Please reach out as soon as possible to Wendell V. Courtney, Esq. ([email protected]) or Starlin Colon, Esq. ([email protected]) of Johnson Duffie’s CTA Compliance Group if you would like us to provide professional services and assistance with respect to this mandatory filing under the CTA.
Johnson Duffie looks forward to being of assistance to you and your company in this important matter, at your request.