The Corporate Transparency Act (CTA), which goes into effect January 1, 2024, will implement uniform federal information disclosure requirements for domestic and foreign reporting companies registered to do business in the United States, unless otherwise exempt. The CTA will require such reporting companies to disclose to the Financial Crimes Enforcement Network (FinCEN) certain information about the company and its beneficial owner. For entities that are created or first registered beginning in 2024, the report must also include information about individuals who primarily control or directly file the formation documents for a domestic entity or the registration documents for a foreign entity.
The CTA is aimed at enhancing corporate transparency and combating financial crimes, particularly money laundering and terrorist financing. Noncompliance with the CTA may result in significant fines and prison terms.
Written by Jonathan Storper and Morgan Gray, Hanson Bridgett LLP, member of USLAW.