The Corporate Transparency Act (CTA) is a federal law that aims to combat financial crimes by establishing a federal database of reporting companies and information about the individual involved in each company’s formation, control, and ownership. Effective January 1, 2024, the CTA mandates that reporting companies and their beneficial owners must file detailed reports and information.
This regulation will affect over 25 million existing business entities and another 3-4 million new entities each year. Missed deadlines or failure to comply can result in costly penalties or even imprisonment. The real hurdle (and complexity) lies in determining which entities require reporting and understanding the deadlines, ensuring you don’t fall out of compliance.
