The Corporate Transparency Act, which became effective on January 1, requires certain business entities to file a beneficial ownership information report with the Financial Crimes Enforcement Network (FinCEN). This Act is meant to make it more difficult for bad actors to conceal financial transactions through shell companies or complex ownership structures, but because the law applies regardless of the value of the business, small business owners are unwittingly impacted by this new law.
Beneficial owners of companies established before January 1, 2024, have until January 1, 2025, to file their initial reports. Companies established between January 1, 2024, and January 1, 2025, must file within 90 days of notification or public announcement of their formation to avoid penalties and fees.
