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- Enacted in 2021, the CTA aims to combat illicit activity including tax fraud, money laundering, and financing for terrorism by capturing more ownership information for specific U.S. businesses operating in or accessing the country’s market.
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What is the Corporate Transparency Act? Enacted in 2021, the CTA aims to combat illicit activity including tax fraud, money laundering, and financing for terrorism by capturing more ownership information for specific U.S. businesses operating in or accessing the country’s market.
- Miranda Fraraccio
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Jan 1, 2024 · The bipartisan Corporate Transparency Act, enacted in 2021 to curb illicit finance, requires many companies doing business in the United States to report information about the individuals who ultimately own or control them.
- What Is The Corporate Transparency Act?
- Who Is Required to Report Beneficial Ownership Information?
- What Is Required to Be Reported and When?
- How Will The CTA Affect State Law Incorporation Practices?
- Takeaways
Congress recently passed the Corporate Transparency Act (CTA) as part of the National Defense Authorization Act. The purpose of the CTA is to “better enable critical national security, intelligence, and law enforcement efforts to counter money laundering, the financing of terrorism, and other illicit activity” by creating a national registry of ben...
Under the CTA, a “reporting company” must report certain beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN) within the Treasury. A “reporting company” is defined as any corporation, limited liability company, or similar entity that is (1) created by filing a formation document with a secretary of state or similar ...
Reporting companies are required to deliver to FinCEN a report containing the following information for each beneficial owner of the reporting company: (1) full legal name, (2) date of birth, (3) current residential or business street address, and (4) unique identifying number from an acceptable identification document or FinCEN identifier, if avai...
The CTA will not require states to maintain a separate beneficial ownership information registry. However, the CTA will require states to notify filers upon initial formation or registration of the federal requirement to provide beneficial ownership to FinCEN. States will have two years after the effective date of the regulations governing the CTA ...
The CTA largely applies to foreign-owned shell companies. However, all companies should review the definition of “reporting company” and all of its related exceptions.Through the CTA, federal agencies and state and local law enforcement agencies will have greater access to beneficial ownership information and will be able to share such information with internati...We anticipate there will be a number of interpretative questions concerning the scope of the exceptions to the reporting obligations. Companies should thus pay close attention to the implementing r...Jan 4, 2024 · The Corporate Transparency Act (CTA) is a federal law enacted on Jan. 1, 2021, with rules scheduled to go into effect on Jan. 1, 2024. It is “intended to help prevent and combat money laundering...
- Greg Daugherty
Oct 19, 2023 · The Corporate Transparency Act (CTA), enacted in 2021, was passed to enhance transparency in entity structures and ownership to combat money laundering, tax fraud, and other illicit activities.
In 2021, Congress enacted the Corporate Transparency Act. This law creates a beneficial ownership information reporting requirement as part of the U.S. government’s efforts to make it harder for bad actors to hide or benefit from their ill-gotten gains through shell companies or other opaque ownership structures.
Apr 16, 2021 · This article describes the proposed federal legislation that evolved into the Corporate Transparency Act (CTA), summarizes the terms of the CTA, and discusses points that should be considered in prescribing the regulations under the CTA.
