New FinCEN Reporting Obligation starting January 1, 2024

In 2021, Congress passed the Corporate Transparency Act (CTA).  This act represents a significant change in the regulatory landscape for ALMOST ALL entities doing business in 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.

The CTA introduced a new reporting requirement for Beneficial Ownership Information (BOI) to be filed with the Financial Crimes Enforcement Network (FinCEN).  Pursuant to this new requirement, reporting companies must disclose detailed information about their Beneficial Owners and Company Applicants.

• Reporting Companies that were created or registered to do business prior to January 1, 2024, must file their initial BOI report by December 31, 2024.
• Reporting Companies created or registered to do business in 2024, must file their initial BOI within 90 days of the effective date of their creation or registration.
• Reporting Companies created or registered to do business on or after January 1, 2025 must file their initial BOI within 30 days of the effective date of their creation or registration.

The CTA applies to a wide range of business entities, including corporations, limited liability companies (LLCs) including Single Member LLCs and other similar entities.  For more information on the new reporting requirements, FinCEN offers detailed and helpful guidance on BOI reporting.  You can visit https://www/fincen.gov/boi

NOTE:

We have been advised by the American Institute of Certified Public Accountants (AICPA), the New York State Society of CPAs (NYSSCPA) as well as our malpractice insurance carrier that compliance with CTA is not an accounting nor a tax function and is a legal task of your business.  Therefore, we have been informed that doing so could be construed as practicing law without a law license.

Your compliance with the Corporate Transparency Act (CTA) including beneficial ownership information (BOI) reporting is NOT within the scope of our engagement.  You have the sole responsibility for your compliance with the CTA, including its BOI reporting requirements and the collection of relevant owner information.  We shall have no liability resulting from your failure to comply with the CTA.  Consider consulting with legal counsel if you have questions regarding the applicability of the CTA’s reporting requirements and the issues surrounding the collection of relevant ownership information.