As you may have heard, the US Corporate Transparency Act requires many companies doing business in the United States to report information about the individuals who ultimately own or control them. The law was passed to curb illicit finance and protect US national security.
The information to be filed is limited to identifying data (name/address/tax ID number) of the company and its “beneficial owners.” In this context, beneficial owner means (i) each individual directly or indirectly owning 25% or more of the company, (ii) each senior officer of the company, and (iii) each senior officer of any company which owns 25% or more of the reporting company.
Unless exempt, all existing corporations, LLCs or similar entities must file their initial report by the end of this year (December 31, 2024).
Unlike many other regulations, most small companies are NOT exempt from the Corporate Transparency Act. In fact, a smaller company is actually more likely to have a reporting obligation than a larger one. If you’re unsure of your exempt status, please contact us for a quick review.
Filing is simple, secure, and free of charge, and is done online at www.fincen.gov/boi.
We recommend that each individual who is required to be identified in the filing obtain a “FinCEN ID,” available through www.fincen. gov/boi. This enables filing without disclosure of personal information each time.
Beneficial ownership information reporting is not an annual requirement. A report only needs to be submitted once, unless the filer needs to update or correct information.
Please let us know if you have questions or need assistance in determining your obligations under the Corporate Transparency Act.
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This advisory is for information purposes only, and does not constitute legal advice. If you would like to discuss the impact of the US Corporate Transparency Act, please contact Peter Moldave at (617) 350-6800, or email him at peter.moldave@gesmer.com.
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