Skip to main content

Commentary & Insights

Insight

New CTA Requirements You Need to be Aware Of

20 February 2024

By: Jeremy Runnels

Why?

As of January 1, 2024, there are new requirements under the Corporate Transparency Act (CTA). This bipartisan legislation seeks to limit the use of shell companies for illegal activities. The new reporting requirement implements a mandatory filing to report and disclose information regarding the ownership and control of any tax-filing entity. Unless there is a change in ownership, this filing will only need to be completed one time. 

Who needs to report?

  • Any corporation, Limited Liability Company, or any other entity that was created by filing documents with a Secretary of State in the U.S. 
  • Any foreign entity registered to do business in the U.S. 

If you have a business or utilize entities to hold assets, you will most likely be required to meet these filing requirements. 

Trusts do not need to report unless they hold an interest in a reporting company. If a trust or estate does own an interest in a reporting company, you should check with your CPA on your potential filing requirement. 

There are also many exemptions to the filing requirements, which can be found here: https://www.fincen.gov/sites/default/files/shared/BOI_Small_Compliance_Guide.v1.1-FINAL.pdf

When do you need to report by?

Entities in existence before January 1, 2024 have until January 1, 2025 to file. Entities created in 2024 have 90 days after formation or registration with a Secretary of State office to file, and entities created on or after January 1, 2025 have 30 days to file. 

Where can I file?

FinCen.gov

The process for a single beneficial owner takes about 10 minutes to complete and can be completed by anyone the owner designates to complete it. There is no fee to file. 

What if I don’t file? 

There are steep penalties for not reporting the least of which is a fine of $500 per day that the violation continues.

Now what?

WCF will not file these reports for clients. However, we are available to answer questions. We can also connect you with professionals we know and trust that can assist you in filing this report.