Dear Valued Clients,
Re: Important Update Regarding the Corporate Transparency Act (CTA)
I hope this letter finds you well. At KVLSM LLP, we value the trust and partnership we have built with our clients over the years, and we are committed to keeping you informed about important developments that may affect your business. Today, we would like to bring your attention to the upcoming implementation of the Corporate Transparency Act (CTA) and its potential impact on your operations.
The Corporate Transparency Act, which was passed by Congress in 2021 represents a significant change in the regulatory landscape for businesses across the United States. The primary goal of the CTA is to enhance corporate transparency and combat financial crimes, such as money laundering and the financing of terrorism. To achieve these objectives, the CTA introduces new reporting requirements that will apply to ALMOST ALL businesses, beginning in 2024.
Here are some key aspects of the CTA that you should be aware of:
- Reporting Beneficial Ownership: Under the CTA, certain businesses will be required to report their beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN). This information includes details about individuals who own or control the company, helping to prevent the use of anonymous shell companies for illicit purposes.
- Applicability: The CTA applies to a wide range of business entities, including corporations, limited liability companies (LLCs) including single member LLC’s, and other similar entities. The specific reporting requirements and exemptions may vary depending on your business’s size, structure, and activities.
- Privacy and Security: We understand that privacy and data security are paramount concerns for our clients. Rest assured that we are committed to safeguarding your sensitive information and ensuring compliance with all relevant data protection regulations.
- Information required to be reported:
Information for the Entity:
- Legal name and Trade name or DBA
- Jurisdiction formed in
- Federal ID Number
Information needed for all the Beneficial Owners (and/or controlling individuals):
- Percentage of beneficial ownership
- Identifying Number from a Driver’s License or other approved document
- Image of that document that the number is from (e)
- If you form a Corporation, S-Corporation, Partnership, or Limited Liability Company (LLC) (either Multi-member or Single-Member LLC) at any time in 2024 OR if you change the ownership of an existing entity listed above, or if there is a change to the personal information of any beneficial owner (name, address or ownership %), you will have a filing due to FINCEN within 90 days of the date of that change.
At KVLSM LLP, we are actively monitoring developments related to the CTA and working to ensure that our clients are aware of this new regulatory filing requirement. Currently, the exact filing procedures are not yet finalized.
As the implementation of the CTA progresses, we will continue to provide you with updates, guidance, and resources to help you remain in compliance and minimize any potential disruptions to your business operations.
Thank you for entrusting KVLSM LLP with your business needs. We value our relationship with our clients and remain dedicated to helping you succeed in this evolving regulatory landscape.