On January 1, 2021, Congress enacted the Corporate Transparency Act (“CTA”), which requires that certain companies disclose the identity of their beneficial owners and provide other information to the Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) beginning January 1, 2024 (the “Reporting Rule”). For a quick overview, you can read about the basics of the CTA here.
Proposed Deadline Extension for Beneficial Ownership Information Reports
Today, FinCEN published a Notice of Proposed Rulemaking (“NPRM”) to extend the reporting deadline for certain filers of Beneficial Ownership Information Reports (“BOIRs”). Under the Reporting Rule, entities created or registered on or after January 1, 2024 must file BOIRs with FinCEN within 30 days of notice of their creation or registration. The NPRM proposes to extend that filing deadline from 30 days to 90 days for entities created or registered on or after January 1, 2024 and before January 1, 2025. The purpose of the proposed deadline extension is to provide these entities more time to understand the new reporting requirements and gather the required information to complete the filing.
Comments on the NPRM are currently being received, but it is expected that the NPRM will become a Final Rule by the end of this year.
Small Entity Compliance Guide Overview
Additionally, FinCEN recently published the Small Entity Compliance Guide on September 18 to help organizations, in particular small entities, comply with their BOIRs. The guide provides a helpful outline, checklists and additional tools that entities can use to understand the beneficial ownership reporting requirements under the CTA. While the guide falls short of providing the form of the BOIR, it makes clear what entities will need to do to comply with it.
The attorneys at Barley Snyder continue to follow the Corporate Transparency Act closely and provide updates as new information is released. If you have questions regarding the CTA or the beneficial ownership disclosure requirements, please contact Partner Dan Desmond or any member of the Barley Snyder Business Practice Group.