Navigating the Corporate Transparency Act (CTA)

In this post, we'll share important information regarding the recent changes brought about by the Corporate Transparency Act (CTA). The CTA mandates that nearly every entity must file a Beneficial Ownership Interest (BOI) report. For your convenience, the following are exempted entities:

So, what exactly is a BOI report? It's a way of disclosing information about individuals who either directly or indirectly own or control a company. A beneficial owner is someone who exercises substantial control over the reporting company or owns/controls at least 25% of the company's equity interest. To help you navigate this, we've included the following guide to help you determine "substantial control indicators," such as senior officers, appointment authorities, and key decision-makers within the business.

Ready to file your BOI? You can do so at BOI e-filing portal, or directly through Carta. As a Carta Partner law firm, we are Carta Certified Experts and can help your company comply with the CTA even more seamlessly through your Carta account.

Importantly, the deadline for businesses created before January 1, 2024, is December 31, 2024. For businesses created after that date, you have 90 days after the business's initial filing date to submit your BOI.

Here's a quick step-by-step guide for some of the spots our clients have had trouble with during filing:

1. Section 1: Select "Initial Report"
2. Part One #3: Choose "Request to receive FinCEN ID"
3. Part One #5-6: Enter legal name, DBA(s), or trade name(s)
4. Part One #7-8: Select Tax Identification Type (EIN or SSN), enter the number, and ignore country/jurisdiction unless filed in a different country
5. Part One #10-15: Enter country and current US business address
6. Part One #16: If your entity was created before January 1, 2024, select "Existing reporting company"; if created after, leave it unchecked
7. Continue with the relevant sections based on whether you have a FinCEN ID or not. Sections 19-33 and 37-51 are crucial for providing information about who is filing the BOI report and details about the beneficial owners.

Remember, anyone authorized by the reporting company can file on its behalf, including employees, owners, or third-party service providers. Be prepared to provide a form of ID (driver's license, ID, passport, etc.) during this process.

Once all sections are completed, simply submit the document. If you have any questions or need assistance, feel free to schedule time with one of our attorneys by clicking the link below this article. Thank you for reading, and here's to a transparent and successful year for your business!