{"id":8404,"date":"2023-08-16T15:07:07","date_gmt":"2023-08-16T20:07:07","guid":{"rendered":"https:\/\/nwfl4sale.com\/businesses-to-declare-beneficial-ownership-in-2024\/"},"modified":"2023-08-16T15:07:07","modified_gmt":"2023-08-16T20:07:07","slug":"businesses-to-declare-beneficial-ownership-in-2024","status":"publish","type":"post","link":"https:\/\/nwfl4sale.com\/businesses-to-declare-beneficial-ownership-in-2024\/","title":{"rendered":"Businesses to Declare \u2018Beneficial Ownership\u2019 in 2024"},"content":{"rendered":"
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In a push to reduce money laundering under the Corporate Transparency Act, FinCEN will require many businesses to state their actual owners\u2019 names after Jan. 1.<\/span><\/span><\/p>\n<\/div>\n WASHINGTON \u2013 Beginning with the Panama Papers leak in 2016, there has been an increasing focus on the use of business entities to facilitate money laundering and conceal profits of crime and corruption. Europe and the UK are far ahead of the U.S. in the implementation of \u201cbeneficial ownership\u201d registers for business entities and trusts and, in recent years, the U.S. has come under increasing pressure to do the same.<\/span><\/span><\/p>\n The Corporate Transparency Act (CTA) is a response to this pressure and was authorized under the Anti-Money Laundering Act of 2020<\/a> with the intent of combating money laundering and terrorist financing by expanding the regulatory power of the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury.<\/span><\/span><\/p>\n The CTA, which was enacted on Jan. 1, 2021, comes into effect on Jan. 1, 2024, and imposes new federal reporting requirements on many business entities operating in the U.S.<\/span><\/span><\/p>\n While there are exceptions for certain highly-regulated entities (such as banks or entities that report to the U.S. Securities and Exchange Commission) and large operating companies, most business entities formed by a filing with a secretary of state\u2019s office will be required to disclose to FinCEN personal identifying information about the individual creating the entity and the beneficial owners of such newly created entity.<\/span><\/span><\/p>\n The CTA will also require that such information be updated and\/or corrected within 30 days of any changes to the initially reported information.<\/span><\/span><\/p>\n Reports must be filed by domestic and foreign \u201creporting companies.\u201d<\/span><\/span><\/p>\n There are 23 reporting exemptions under the CTA. These exemptions include:<\/span><\/span><\/p>\n Highly regulated entities, such as:<\/span><\/span><\/p>\n Large operating companies that meet the following general criteria:<\/span><\/span><\/p>\n Reporting companies must provide the following information to FinCEN:<\/span><\/span><\/p>\n Beneficial owners of reporting companies and company applicants who form reporting companies must provide:<\/span><\/span><\/p>\n To ease the burden of having to provide the above information multiple times for an individual who has reporting obligations as to multiple entities, the CTA provides for a \u201cFinCEN Identifier\u201d: a unique identifying number assigned to a person by submitting to FinCEN an application containing the information about that person which would be required in a report filed by a reporting company.<\/span><\/span><\/p>\n Company Applicants are the individuals who file or direct the filing of the document that: (1) creates the domestic reporting company, or (2) first registers the foreign reporting company in the U.S. If more than one individual is involved in the filing of the document, the individual primarily responsible for directing or controlling such filing is the Company Applicant.<\/span><\/span><\/p>\n There can be a maximum of two Company Applicants for each entity; i.e., the person who directly files the relevant document and the person who is primarily responsible for directing or controlling the filing of the relevant document. Only reporting companies formed on or after Jan. 1, 2024, must report Company Applicants.<\/span><\/span><\/p>\n A Beneficial Owner is an individual who either: (1) exercises substantial control over the reporting company; or (2) owns or controls at least 25% of the (direct or indirect) ownership interests of the reporting company. All reporting companies, whether formed before or after Jan. 1, 2024, must report Beneficial Owners.<\/strong><\/span><\/span><\/p>\nWho is required to file reports with FinCEN?<\/span><\/span><\/h3>\n
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What \u201cBeneficial Ownership Information<\/a>\u201d must be reported?<\/span><\/span><\/h3>\n
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Who are Company Applicants and Beneficial Owners?<\/span><\/span><\/h3>\n
Important CTA deadlines<\/span><\/span><\/h3>\n
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What can you do now to prepare?<\/span><\/span><\/h3>\n
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