In December 2021, the U.S. Treasury Department's Financial Crimes Enforcement Network (FinCEN) proposed legislation to safeguard the financial system from illicit uses, fight money laundering and related crimes, including terrorism, and promote national security through the strategic use of financial authorities and the collection, analysis, and dissemination of financial information. Under the Corporate Transparency Act (CTA), reporting companies will be required to report to FinCEN certain identifying information regarding the company and its "beneficial owners" and "corporate applicants".
The Corporate Transparency Act comes into effect on January 1, 2024. Reporting companies that are in existence on the effective date must file their initial reports within one year.
Reporting companies created after the effective date have 90 days after receiving notice of their creation or registration.
Reports must be updated within 30 days of a change to the beneficial ownership, e.g., through the sale of a business, merger, acquisition, or death, or 30 days upon becoming aware of or having reason to know of inaccurate information previously filed.
Check out our blog for more information about the Corporate Transparency Act (CTA).