08/07/2024
Do you own or control a private business with less than 20 US employees and less than $5 million in annual gross receipts/sales? Are you aware that you are required to report your beneficial ownership to the Financial Crimes Enforcement Network (the FinCEN), which is part of the U.S. Department of the Treasury? This reporting requirement is due to the Corporate Transparency Act, which Congress passed in 2021. Its purpose is to increase transparency and make it harder for bad actors to hide or benefit from illicit actitivies through shell corporations or conceal ownership structures.
The reporting requirements apply to private corporatons, LLCs, and other business entities, domestic and foreign. While some entities may be exempt from reporting, many are not. And the penalties for not reporting are severe: civil penalties of up to $500.00 per day, while wilful failure to report can lead to two years of imprisonment and a fine of up to $10,000.00. For businesses registered with their state prior to January 1, 2024, the deadline to report is January 1, 2025. For businesses registered on or after January 1, 2024 and before January 1, 2025, you must file a report within 90 calendar days of receiving confirmation of your corporation's incorporation or organization of your LLC or partnership.
I offer up this information because I know that many of my FB friends may be subject to these requirements. If you are one of them, please make sure you take care of this before you run into the deadlines.