The Corporate Transparency Act (CTA) is a U.S. law enacted to enhance transparency in corporate ownership and to help combat financial crimes such as money laundering and terrorist financing.
Here are the key points about the Act:
- Purpose: The CTA aims to provide the federal government with information about the individuals who ultimately own or control businesses, making it harder for illicit activities to be concealed behind anonymous companies.
- Beneficial Ownership Information (BOI): Under the Act, certain businesses must file reports disclosing their beneficial owners—essentially, the people who ultimately own or control the business.
- Reporting Requirements: Businesses meeting specific criteria are required to submit BOI reports to the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN). This includes information like the names, addresses, and identification numbers of beneficial owners.
- Exemptions: There are exemptions for certain types of businesses, such as larger companies, regulated entities (like banks), and nonprofits.
- Implementation Timeline: The CTA went into effect at the beginning of 2024, and businesses must comply with the reporting requirements by January 1, 2025.
Please visit CAI’s Corporate Transparency Act resource page for additional information.
