Starting January 1, 2024, many companies will be required to report information to the U.S. government about who ultimately owns and controls them.
Who?
All currently existing formal business entities will be required to file an initial report prior to January 1, 2025. If an entity is formed after January 1, 2024, it will have 90 days to file a report.
What?
The Corporate Transparency Act, passed in 2021, created a Beneficial Ownership Information (BOI) reporting requirement for nearly all formally established small businesses (incorporated businesses and LLCs) and foreign companies registered to do business in the US.
A beneficial owner is an individual who either directly or indirectly:
- Exercises substantial control over the reporting company (senior officers, anyone who directs, determines or has substantial influence over important decisions made by the company)
- Owns or controls at least 25% of the reporting company’s ownership interests
Why?
The Corporate Transparency Act was designed to increase transparency of business ownership in an effort to combat tax fraud, money laundering, and other illicit activities.
How?
The Beneficial Ownership Information filing includes an online submission, listing information about the beneficial owners of a legally formed entity in the US or a foreign company registered to do business in the US. If something materially changes, then an additional filing will be required.
For more information, including how to self-file, please see the links below:
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