The Corporate Transparency Act (CTA) requires certain U.S. and foreign corporations,
LLCs and other entities created by filing a document with a secretary of state (a Reporting
Company) to file a report with the Financial Crimes Enforcement Network (FinCEN) about
its beneficial owners and company applicants, unless an exemption applies.
Effective January 1, 2024, an entity that fails to file the necessary report, including a
failure to disclose beneficial owners who are trustees or beneficiaries of a trust that has an
ownership interest in a Reporting Company, may be subject to civil and criminal penalties.
Key Takeaways
Exemptions. Exempt entities include (1) entities with (i) more than 20 full-time employees
in the U.S., (ii) a physical office in the U.S. and (iii) more than $5 million in annual gross receipts or sales in the U.S.; (2) public companies; (3) highly regulated entities such as banks, broker-
dealers and insurance companies; (4) non-profit organizations and (5) governmental authorities.
Individuals Who Must Be Identified. The report must identify beneficial owners, including
trustees of a trust and, under certain circumstances, beneficiaries of a trust, who (i) exercise
substantial control over a Reporting Company or (ii) own or control 25% or more of the ownership
interests of the Reporting Company. Entities created on or after January 1, 2024 must also report
company applicants, including persons who file the document that creates a Reporting Company.
Filing Dates. A Reporting Company formed on or after January 1, 2024 must file
its initial report with FinCEN within 30 days of its formation. A Reporting Company
formed prior to that date must file its initial report by January 1, 2025.
We are available to analyze and discuss with you the implementation of appropriate
compliance measures to satisfy the requirements of the CTA.
Contacting Pavia & Harcourt LLP
Questions regarding matters discussed in this publication may be directed to Alessandro Saracino
at [email protected], John Firestone at [email protected] or Joseph Chioffi at
[email protected].
About Pavia & Harcourt LLP
Established in 1951, Pavia & Harcourt LLP is a business law firm concentrating in international
commercial and corporate transactions, banking, media and entertainment, real estate, litigation
and arbitration, intellectual property, estate planning and administration, and matrimonial law. We
are based in New York City.
This publication by Pavia & Harcourt LLP is for information purposes only. It does not constitute legal or other professional advice or opinions on specific facts or matters, nor does its distribution establish an attorney-client relationship. This material may constitute Attorney Advertising as defined by the New York Court Rules. As required by New York law, we hereby advise you that prior results do not guarantee a similar outcome.
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