Beginning January 1, 2024, a new federal law requires many corporations, LLCs, and other entities to report their beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN). This reporting is mandated under the Corporate Transparency Act.
Who Must Report: Most private corporations, LLCs and similar entities created or operating in the U.S. will be considered “reporting companies” that need to disclose their beneficial owners to FinCEN. Exempt entities include publicly traded companies, banks, investment funds and non-profits.
What to Report: Beneficial owners are individuals who directly or indirectly own at least 25% of an entity or exercise substantial control over it. Reporting companies must disclose each beneficial owner’s full legal name, date of birth, address and identifying number from an approved credential.
When to File Initial Report:
- Existing companies before 1/1/24: By 1/1/25
- New companies 1/1/24 – 12/31/24: Within 90 days of formation
- New companies after 1/1/25: Within 30 days of formation
Failure to accurately report can result in significant civil and criminal penalties. FinCEN has also warned about fraudulent phishing attempts related to these new reporting rules.
At RTH Worldwide, we are preparing our clients for compliance with these anti-money laundering requirements. Contact us to discuss how we can assist with the upcoming beneficial ownership reporting mandates for your business entity. Improper reporting puts your company at risk, so get ahead of these new rules today.