The Corporate Transparency Act: A Comprehensive Guide to Compliance

💡The CTA was enacted to address the problem of anonymous ownership of companies and the facilitation of illicit activities.

📆The CTA became effective on January 1, 2024, and has deadlines for filings depending on the formation date of the entities.

🔎Entities formed before January 1, 2024, have until January 1, 2025, to file, while entities formed after have 90 days.

📝The required information includes the reporting company's name, address, jurisdiction of formation, taxpayer ID, and the beneficial owners' details.

⚖️Failure to file on time can lead to penalties of up to $500 per day, criminal charges, and exceptions exist for larger corporations and certain registered entities.

Who does the Corporate Transparency Act affect?

—The CTA affects all reporting companies, including LLCs, corporations, and other registered entities in the US.

What are the deadlines for filing under the CTA?

—Entities formed before January 1, 2024, have until January 1, 2025, while entities formed after have 90 days to file.

What information is required to be filed?

—The reporting company's name, address, jurisdiction of formation, taxpayer ID, and the beneficial owners' details are required.

Who is considered a beneficial owner?

—Beneficial owners are individuals who own 25% or more of the voting interest or shares in a closely held entity or are in a controlling position for the entity.

What are the penalties for failing to file on time?

—Failing to file on time can result in penalties of up to $500 per day, criminal charges, and potential jail time of up to two years for willful non-compliance.

00:00Introduction to the Corporate Transparency Act (CTA)

00:30Enactment and purpose of the CTA

01:13Entities affected by the CTA

01:56Deadlines for filing under the CTA

02:36Required information for filings

03:22Definition and identification of beneficial owners

04:18Penalties for non-compliance

04:47Exceptions and resources for assistance