Blog

As part of our series of blog posts on the Corporate Transparency Act (the “CTA”), we are providing this additional update as the filing deadline for the vast majority of reporting companies is approaching on December 31, 2024. The other blogs in the series include a post from February 15, 2024, which includes a general overview of the CTA and what it means for reporting companies, and an update post from March 19, 2024, detailing legal challenges to the CTA. As we approach the filing deadline for reporting companies that were formed prior to January 1, 2024, we are providing a brief and general overview of the CTA. 

General Overview 

A “reporting company” is an entity that was created by filing a document with the secretary of state or its equivalent under the law of any U.S. state or Indian Tribe or was formed under the laws of another country that is registered to do business anywhere in the United States. Under the CTA, reporting companies are required to provide certain information general corporate information as well as information about its beneficial owners. Certain entities are exempt from filing based on exceptions enumerated in the CTA. The exceptions are not full described in this blog post, though detailed information about the exceptions is included in the blog post from February 15, 2024.

Please keep in mind that entities formed prior to January 1, 2024, have until December 31, 2024, to file their initial beneficial ownership information report with FinCEN. Reports must be filed online through FinCEN’s beneficial ownership information portal. Reporting companies that were formed during 2024 have 90 days from public notice of formation to file their initial report. Entities formed in 2025 and beyond will have 30 days after public notice to file. However, as previously noted, any reporting company formed prior to 2024 is subject to the December 31, 2024, filing deadline. 

Certain information about the reporting company must be included in the report. This includes the reporting company’s: 

1. Full legal name and any trade names, assumed names, and fictitious names; 
2. Current business address; 
3. Jurisdiction of formation for U.S. entities or jurisdiction of registration for foreign entities; and 
4. Taxpayer identification number.

In addition to the information about the reporting company itself, the “beneficial owners” of the reporting company must be disclosed and certain of their identifying information included in the filing. Beneficial owners are individuals who directly or indirectly: (1) exercise substantial control over the reporting company, or (2) own or control at least 25% of the ownership interests of the reporting company. The determination of whether an individual is considered a beneficial owner is fact sensitive. Additional details about substantial control and calculating ownership interests are contained in the first blog in the series from February 15, 2024. 

For each beneficial owner that fits the definition described above, the beneficial ownership information report must contain: 

1. Their full legal name; 
2. Their date of birth; 
3. Their complete current residential address; and
4. A unique identifying number, issuing jurisdiction, and image of the document that includes the unique identifying number (additional information on this requirement is included below). 

Recommendations for Reporting Companies

Given that the filing deadline is quickly approaching, we recommend investigating any potential filing exemptions, and, if determined that no such exemption applies, collecting all of the information necessary to complete the beneficial ownership information report. All reporting companies formed prior to January 1, 2024, have until December 31, 2024, to file their beneficial ownership information report. 

The CTA Team at Whiteman Osterman & Hanna LLP is ready to assist clients with any and all CTA questions. 

The information set forth herein is provided for the general reference of clients and friends of Whiteman Osterman & Hanna LLP, does not constitute legal advice, and shall not be construed as an advertisement or solicitation. ©2024 Whiteman Osterman & Hanna LLP. All Rights Reserved.