03/09/2023
Effective January 1, 2024, the Corporate Transparency Act will require certain companies to file a report with the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) containing personal identifying information about beneficial owners and applicants. The CTA is aimed at protecting the US financial system from being used for money laundering and other illicit activities. From what we now know, it requires entities to file a beneficial ownership information report with the FinCEN and provides that the information will be kept in a private database, where access will be limited mainly to government law enforcement agencies. This reporting requirement will be for domestic limited liability companies, limited liability partnerships, and corporations, no matter how small. Failure to register may carry civil and criminal penalties. Currently existing companies will also be required to file by that date. Reporting must include information about each beneficial owner and applicant, including full name, date of birth, current residential address, and photo identification. This registration requirement will affect many of my clients and business owners. Additionally, reporting requirements must include information about the individual who directly files a document that creates a domestic reporting company. Essentially, this includes lawyers who file documents for clients creating such entities. The American Bar Association had previously expressed concerns about the Act in that the reporting would impose burdensome and intrusive regulations on millions of small businesses and their lawyers. I stand with the opinion of the ABA. I have, until now, provided legal services to my regular clients that included forming entities in conjunction with other legal matters. As a result of these new reporting requirements, and the burden it imposes on my office to register each time, I have decided that I will no longer be providing this service. Naturally, we will talk about options and I will assist in finding an agency who will provide these services for you.