The Corporate Transparency Act (CTA) implements sweeping new corporate ownership reporting requirements for companies that are based in or conduct business in the United States. The law was passed by Congress as part of the 2021 National Defense Authorization Bill as an anti-laundering effort and requires businesses to register and disclose expanded ownership information to the federal government.<\/p>\n
What the CTA does<\/strong><\/p>\n The new CTA requirements take effect on January 1, 2024, and reporting companies will have either 30 days or one year (depending on formation date of company) to comply by filing initial reports. While the reported information will not be accessible to the public, other federal agencies can access it along with state and local law enforcement entities.<\/p>\n Exemptions<\/strong><\/p>\n There are several exemptions for these new requirements which will mostly benefit well-established businesses, including:<\/p>\n Many companies affected with the additional compliance burden will be small and early-stage businesses whose prior year tax filings will likely not satisfy the exemption requirements and could create additional costs. Furthermore, this could have an effect on access to capital for small businesses and start-ups, which often rely on investment from angel investors and private funds that historically prefer to have their investments insulated from public disclosure.<\/p>\n Failure to comply with the CTA or fraudulent reports can result in civil fines of $500 per day and criminal penalties of up to $10,000 fine or two years in jail.<\/p>\n","protected":false},"excerpt":{"rendered":" The Corporate Transparency Act (CTA) implements sweeping new corporate ownership reporting requirements for companies that are based in or conduct business in the United States. The law was passed by Congress as part of the 2021 National Defense Authorization Bill as an anti-laundering effort and requires businesses to register and…<\/p>\n","protected":false},"author":32,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[247],"tags":[],"class_list":["post-9324","post","type-post","status-publish","format-standard","hentry","category-advocacy-and-legislation"],"acf":[],"yoast_head":"\n\n
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